Swiss insurers put exposure to Hurricane Charley at $400m

Switzerland's leading insurers yesterday put their combined exposure to Hurricane Charley at less than $400 million (€323.5 million, based on preliminary estimates.

Swiss Re, the world's second biggest reinsurer, said it expected claims would be less than $200 million before tax - not enough to prompt a revision of its profit outlook.

Zurich Financial Services, the country's biggest primary insurer, said it estimated claims of about $150 million, net of reinsurance. Separately, Converium, the re-insurer that was spun off from ZFS in 1999, forecast claims of less than $25 million.

Industry estimates for the total value of the damage caused vary widely. Swiss Re believes the total cost will be between $5 billion and $10 billion, while Munich Re, the world's biggest reinsurer, has put the total between $7 billion and $14 billion.

The industry does agree that Hurricane Charley, which hit Florida on August 13th and caused at least 22 deaths, was the costliest natural disaster of its kind since Hurricane Andrew in 1992. It was responsible for insured losses - adjusted for 2003 prices - of about $21 billion.

Earlier this week. Munich Re put its exposure in the "low triple-digit millions" of euros, but declined to predict whether that would undermine its €2 billion profit target for 2004. Hannover Re, the world's number four reinsurer, put its exposure at "a net €100 million at most" and said its full-year profit target of €390 million - €430 million would be unaffected.

Allianz, Europe's biggest primary insurer, estimated its exposure should be in the "mid-double digit millions of euros." - (Financial Times Service)