California wildfires from earlier this fall will likely slam Chubb with sizable fourth-quarter catastrophe lost costs. Those numbers are significantly lower, however, than the insurer’s Q3 hits from Hurricanes Harvey, Irma and Maria.
Chubb reported preliminary estimates of about $249 million in Q4 after-tax natural catastrophe losses, about $215 million of which stems from the California wildfires. Chubb said its pre-tax estimate amounts to approximately $320 million in natural catastrophe losses, of which $280 million stemmed from wildfire insured losses.
The estimates are net of reinsurance, and include reinstatement premiums. Loss estimates are drawn from Chubb’s commercial and personal property/casualty insurance business as well as its reinsurance operations.
California’s historic wildfires could lead to as much as $8 billion in insured losses overall, Aon Benfield’s Impact Forecasting estimated in its October 2017 Global Catastrophe Recap. The October wildfires killed at least 43 people in California and injured 185. CalFire data cited by Impact Forecasting showed nearly 9,300 structures were damaged, of which 8,560 were destroyed. As of that October report, the California Department of Insurance cited at least 19,000 residential, commercial and auto claims already filed, where payouts surpassed $3.32 billion.
Hurricanes Harvey, Irma and Maria caused more than $1.2 billion in anticipated losses for Chubb during Q3. While those losses are major, Chubb kept overall net losses during the quarter to $70 million. Chubb Chairman and CEO Evan Greenberg said the Q3 losses were “within our tolerance for risk and the amount of loss we would expect for these events.”