Progressive expects up to $120m loss from hurricane Michael
US motor insurer Progressive is expecting a loss of up to $120 million from hurricane Michael.
Hurricane Michael made landfall on October 10, 2018, near Panama City, Florida, as a strong category 4 hurricane and then impacted Alabama and Georgia, as a major hurricane.
Progressive currently estimates that its vehicle businesses will incur losses of approximately $60 million in connection with this storm. The estimate is based on very early claims reporting information, experience with severity and reporting patterns from many past storms, and several assumptions, including mix of claims.
In addition to the expected losses from the motor business, Progressive faces a maximum of $60 million in losses from the property business. This value represents the retention level under the insurer’s property catastrophic reinsurance coverage. Progressive it is still early for a precise estimate of the impact of hurricane Michael on the property business.
Industry insured losses resulting from hurricane Michael’s winds and storm surge are expected to range from $6 billion to $10 billion, according to estimates by catastrophe risk modelling firm AIR Worldwide.
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