Travelers’ wildfire losses could reach $675 million

Residents watch wildfires approach their homes./ SHUTTERSTOCK.COM

Travelers Cos. Inc. on Thursday said it estimates fourth-quarter catastrophe losses related to the recent California wildfires, including estimated recoveries from reinsurance, will be in the range of $525 million to $675 million pretax and $340 million to $440 million after-tax.

In a statement, Travelers said its estimates reflect losses from its commercial businesses, including its agribusiness unit. Estimates also reflect variables including the high average replacement value of homes in the affected areas and a high incidence of total losses including contents, other structures and additional living expenses.

“The toll from one of the worst wildfire events in U.S. history is devastating,” Alan Schnitzer, Travelers’ chairman and CEO, said in the statement. “Lives were tragically lost, property and personal possessions were destroyed, and entire communities are now forced to start over.

These most recent catastrophe loss estimates follow a third quarter that saw many insurers and reinsurers report quarterly losses related to catastrophes that are expected to cost the industry $100 billion or more.