Aspen puts Q3 cat loss at $360m, largely from reinsurance segment

Aspen Insurance Holdings Limited has published its estimate of third-quarter 2017 catastrophe losses, with $360 million of impact expected from events including hurricanes Harvey, Irma and Maria. The majority of these losses come from Aspen’s reinsurance business segment.

Aspen estimates that $110 million of the loss will be from Hurricane Harvey, $135 million from Hurricane Irma and $65 million from Hurricane Maria, with another $50 million coming from other events including weather-related losses and the Mexico earthquake.

75% of the Aspen’s estimated losses are from its reinsurance business segment, which suggests that the Aspen Capital Markets third-party capital vehicles are likely to take their share, including its $130 million collateralized reinsurance sidecar Silverton Re and its more recently launched special purpose reinsurer Peregrine Re. The other roughly 25% of the catastrophe losses are from Aspen’s insurance business.

Aspen said that its $360 million of catastrophe losses are net of reinsurance and reinstatement premiums. But the company also said that it expects to record an underwriting loss of approximately $340 million for the third-quarter of 2017, due to their impacts.

As well as the catastrophe losses Aspen said that its underwriting loss is due to increased losses in short-tail insurance lines, largely from its property insurance business.

ILS investors continue to support the larger reinsurance firms with their Q3 catastrophe loss toll and it’s safe to assume that Aspen will be sharing a portion of its losses with third-party reinsurance capital. The company increased its cessions to ILS investors in the last year.