Zurich sees $550 million hit from Hurricane Ian, premium rate hikes

(Reuters) – Zurich Insurance Group Ltd. expects a net $550 million pre-tax hit from Hurricane Ian, it said on Thursday, though it remains on track to beat its 2020-2022 financial targets, helped by premium rate rises.

Insurers face potential losses of up to $60 billion from Hurricane Ian, which ravaged Florida and the Carolinas in September in what could be the second-largest natural catastrophe loss in U.S. history.

Climate change is contributing to greater losses for insurers from natural catastrophes.

Europe's fifth-largest insurer said it saw its overall catastrophe loss ratio for the first nine months around two percentage points above long-term trends.

Zurich holds an investor day next week when it will set out its 2023-2025 targets.

“The group continues to be on track to exceed its strategic and financial targets for the 2020-2022 cycle,” said Group Chief Financial Officer George Quinn in a trading statement, pointing to “robust premium increases across the group.”

Zurich reported property and casualty premiums rose 8% to $33.5 billion in the first nine months, a gain of 13% on a like-for-like basis.

The insurer said life insurance new business annual premium equivalent fell 6% but rose 2% on a like-for-like basis that adjusts for currency movements, acquisitions and disposals.

Zurich's Swiss Solvency Test capital ratio was estimated at 252% as of Sept. 30, up from 212% a year ago, a sign of greater capital strength.