Primary insurance giant Allstate has estimated that the California wildfires will cost the firm around $452 million in losses, before tax, which took its October catastrophe loss tally to $514 million.
Allstate said that 11 catastrophe events cost the firm $502 million, which added to $14 million of reserve strengthening on previously announced losses, took its estimated catastrophe losses for October 2017 to $516 million (or $335 million after-tax).
The majority, or 90%, was due to the impacts of five wildfires in California, the insurer said, a sizeable hit from the recent wildfire outbreak which is estimated to be set to cause an insurance and reinsurance industry loss of around $8 billion.
The wildfire losses are set to push Allstate’s fourth-quarter catastrophe loss burden way above expectations, making it two quarters in a row when large U.S. primary players, like Allstate, are set to report an elevated catastrophe loss.
Allstate’s $452 million of California wildfire losses are just the latest to emerge, following announcements from Travelers that it expects up to $675 million of loss after reinsurance, as well as AIG that said it expects around $500 million after reinsurance, and USAA pegged the wildfire loss at up to $581 million.
Allstate’s estimate is after reinsurance, we believe, although it doesn’t state it as such. But previous monthly catastrophe loss estimates have been after reinsurance is taken into account, but before tax.
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