Covid-19, civil unrest & severe weather dents CNA by $301m in Q2

U.S. commercial property and casualty carrier CNA Financial Corporation has reported a $301 million estimate of its second-quarter 2020 catastrophe losses, due to the impacts of the Covid-19 pandemic, rioting and civil unrest, as well as severe weather.

The overall catastrophe loss burden of $301 million for Q2 2020 reported by CNA is well above where analysts had estimated it, as the Covid-19 losses and riots took expectations higher.

But the natural catastrophe losses, largely severe weather related, are also seemingly above estimates, following in-line with many other carriers pre-announcements of higher than expected impacts from convective weather, storms and hail events.

Unpacking the losses, Covid-19 accounts for $182 million of the catastrophe losses, substantially classed as incurred but not reported (IBNR) reserves, with commercial property lines driving some of that burden.

The rioting and civil unrest in the United States continues to feature in most pre-announcements of Q2 losses, with CNA reporting $61 million of losses from those events.

Severe weather came in at a slightly above expectation $58 million for the quarter for CNA.

The company expects to report a pretax underwriting loss for the quarter of $210 million thanks to these catastrophe losses and another $50 million of unfavourable reserve development due to New York reviver statute-related claims experienced in the quarter.

CNA joins the likes of Heritage, The Hanover, Arch Capital, Travelers, W. R. Berkley, Universal, Chubb, United, Cincinnati Financial and Selective Insurance Group and The Hartford, in reporting catastrophe losses above analyst expectation for Q2 2020.