Everest Re Group estimated pre-tax losses of $150 million during the first quarter from claims related to the coronavirus pandemic.

The company expects that the majority of pandemic losses will come from the Reinsurance Segment, although both its reinsurance and insurance operations are likely to report a combined ratio below 100%, indicating an underwriting profit.

Addressing the question of its investment performance during the COVID-19-related economic crisis, Everest affirmed it has a well-diversified portfolio, focused on “high quality fixed income investments.” In a de-risking move, Everest has increased fixed income credit quality and reduced its equity exposure.

For the first quarter, Everest expects to generate net investment income of $148 million, although some of its investments are subject to a reporting lag and will be reported in the second quarter.

“Everest anticipates this pandemic could have a meaningful impact on revenue, as well as net and operating income in future quarters as a result of reinsurance and insurance claims due to the pandemic and resulting macro-economic market conditions,” said the company in a statement. Everest noted that the actual ultimate losses may vary materially from current estimates because of the uncertain and evolving nature of the pandemic.

“Our capital position remains a source of strength, with high quality invested assets, significant liquidity, low financial leverage, and a low operating expense ratio. Our diversified global platform with its broad mix of products, distribution and geography is resilient,” said Everest President & CEO Juan C. Andrade, in a statement.

Source: Everest Re Group, Ltd

*This story ran previously in our sister publication Insurance Journal.