Chubb Chairman and CEO Evan Greenberg said he expects the insurer—at least for now—to experience only modest impact from the coronavirus tearing through China and around the world.

The fast-moving virus has disrupted supply chains and airplane travel and sickened thousands, causing hundreds of deaths in China.

“We see very minimal loss exposure from this,” Greenberg said during the company’s Feb. 5, 2020 analyst call held to discuss 2019 fourth-quarter earnings. “We have a very small, almost non-existent accident and health business in China [and] imagine modest impact from everything we can tell, from economic slowdown or economic activity.”

Greenberg noted, however, that the coronavirus’s full impact has yet to play out.

“Time will tell in that regard,” he said. “We don’t know the true infection rate…and we don’t know when this is going to peak. That is what I can give you based on what we know today.”

Still, in framing his answer about the coronavirus impact, Greenberg pointed out that Chubb has dealt with this kind of thing before.

“We’re experienced—we’re informed in our underwriting from past pandemics and for potential pandemics. SARS was a good run at this,” Greenberg said. “Given our underwriting position and how we think about supply changes, and how we think about property and the perils we cover,” Chubb should do fine, he explained.

Crop Insurance Losses, and One Small Neighborhood

Early in his remarks Greenberg spent time drawing a contrast between the company’s crop insurance losses and its overall catastrophe results.

As Greenberg reminded listeners, Chubb booked a $23 million pre-tax underwriting loss for its Agriculture insurance versus $161 million in pre-tax underwriting income in the 2018 fourth quarter. That stark difference came from yield shortfalls due to difficult growing conditions. Greenberg attempted to place the loss into context as a blip compared to smoother sailing in recent years.

“As I pointed out before—by its nature—crop insurance is a business with cat-like exposures,” Greenberg said, with results adversely affected by everything from moisture to temperature. But the business has generally been an asset for Chubb, he added.

“The risk reward for crop insurance has been favorable for Chubb over the long, short and medium term, and after three exceptional years from [2016 to 2018], last year was below average,” he noted.

Greenberg also reminded listeners that catastrophe losses can erupt from quirky, random circumstances.

Chubb reported Q4 2019 catastrophe losses of $353 million versus $506 million in the 2018 fourth quarter. Greenberg pointed out that half of the Q4 2019 cat losses stemmed from one single event: a tornado that destroyed a mile-by-mile-and-a-half affluent neighborhood in the suburbs of Dallas.

That particular neighborhood just happened to be one where Chubb carried a significant market share.

As Greenberg asked, “What are the odds?”