Argo Group International Holdings expects pretax net catastrophe losses of $29 million during the 2020 first quarter, the bulk of which stems from costs relating to the COVID-19 pandemic.
The Bermuda-based specialty insurer and reinsurer said that all but $3 million of its loss estimate is coronavirus-related. Those COVID-19 expenses come specifically from contingency and property exposures in Argo’s International Operations and primary exposures in its U.S. Operations, the company said.
In particular, Argo said that property losses stem from business interruption coverage and expected costs relating to “potential litigation.”
Moving forward, like an ever-increasing number of insurers, Argo warns it will deal with additional loss and claims expenses relating to the pandemic.
Additionally, Argo said it expects pretax net (realized and unrealized) investment losses of $162 million, partly offset by $35 million in net investment income for Q1 2020. Those losses stem from “extreme volatility in interest rates, credit spreads and equity markets,” Argo explained.
In the 2019 fourth quarter, Argo booked a $103.3 million net loss, as well increases in its U.S. liability, professional and property lines loss ratios.
Argo plans to release its Q1 2020 financial results on May 7, with an investor conference call scheduled for May 8.
Source: Argo Group