Spanish insurance and reinsurance group Mapfre said it believes typhoons Faxai and Hagibis will drive more than US $20 billion of industry losses to the sector, while it expects to take a hit of around $156 million, including some impacts from recent rioting in Chile.
The company, which operates reinsurance unit Mapfre Re as well as its personal and commercial lines insurance operations, said that typhoon Hagibis in particular is now considered the worst typhoon recorded in Japan for the last 70 years, suggesting a Jebi-like loss remains likely.
In recent weeks the market has moderated its outlook for industry losses from typhoon Hagibis somewhat, with the top-end predictions of a US $16 billion market loss seen as much less likely now.
AIG also reported recently that its claims count from typhoon Hagibis is currently lower than it had anticipated it would be by this stage.
How much any flood related complications seen with this typhoon loss could be contributing here is unknown at this stage.
Also, as we explained recently that doesn’t account for Hagibis loss creep that could emerge further into the future, as was seen with 2018’s typhoon Jebi.
Overall though, a combined US $20 billion insurance and reinsurance industry impact from Faxai and Hagibis would need the losses to settle towards the upper ends of their ranges, as the combined estimate from leading risk modelling firms ranges from $12 billion to as high as $25 billion currently.
We’re told that where your view of the Hagibis loss currently sits depends largely on how close to the risk you are, so the retro and reinsurance market is opting for higher loss estimates than the direct re/insurers.
Mapfre said that the majority of its losses from these events will come through its reinsurance business and its estimate is based on discussions with ceding companies.