AXIS Capital Provides Initial Comments on Fourth Quarter Results
January 19, 2021 at 08:30 AM EST
AXIS Capital Holdings Limited ("AXIS Capital" or the "Company") (NYSE: AXS) today announced a preliminary fourth quarter net claims estimate in the range of $195 million to $205 million, pre-tax, for catastrophes and weather-related events.
The net claims estimate includes $125 million, pre-tax, for the COVID-19 pandemic. This amount was determined following an extensive review of potential exposures to the COVID-19 pandemic on all lines of business, both short and long-tail, which considered new information provided by clients, global shelter-in-place orders that came into effect in the fourth quarter and outcomes of recent court judgments, including the UK Supreme Court ruling. This amount is in addition to the estimate of $235 million recognized in the first quarter. The Company noted that its claims reserves provide for ultimate COVID-19 related losses across all lines of business incurred at December 31, 2020.
Separately, other catastrophe and weather-related losses in the range of $70 million to $80 million, pre-tax, include Hurricanes Zeta and Delta, and regional weather events in the United States.
In addition, AXIS Capital noted ongoing improvements in its current accident year loss ratios excluding catastrophe and weather-related losses consistent with progress observed earlier in 2020.
As previously announced, the Company's results will be discussed during its conference call on Thursday, January 28, 2021 at 9:30 AM (EST).
About AXIS Capital
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Risk and Uncertainties
The net claims estimate related to the COVID-19 pandemic is subject to significant uncertainty. This uncertainty is driven by the inherent difficulty in making assumptions around the impact of the COVID-19 pandemic due to the lack of comparable events, the ongoing nature of the event, and its far-reaching impacts on world-wide economies and the health of the population. These assumptions include:
The actual net ultimate amount of losses for this event may differ materially from the current net claims estimate.
The Company’s net claim estimate for other catastrophe and weather-related events is based on its ground-up assessment of losses from individual contracts and treaties exposed to the affected regions, including information from clients, brokers and loss adjusters. Industry insured loss estimates, market share analyses and catastrophe modeling analyses were also taken into account, where appropriate.
Due to the nature of these events, including the complexity of assessing the losses and factors contributing to those losses, the actual net ultimate amount of losses for these events may differ materially from the current net claims estimate.
Cautionary Note Regarding Forward-Looking Statements
The Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.