Impact from earthquake for Italian insurers is limited: Fitch

Fitch Ratings has estimated that the insured losses of the earthquake that struck central Italy in late August will be between €100 million and €200 million.

The fairly limited impact for Italian insurers is expected to arise from property lines, and Fitch’s estimate reflects the low density of population and businesses and limited insurance coverage in the region.

Fitch suggests claims of this magnitude would not have a material impact on Italian insurers' underwriting results or credit profiles.

A state of emergency in the region hit by the earthquake has been declared, and the government has pledged €50 million for first aid.

This declaration means that certain losses will be covered by a state fund for emergencies, limiting losses for insurers.

“We expect the insured losses to be €40 million-€80 million for primary insurers and €60 million-€120 million for reinsurers. A similar event that struck a nearby area in 2009, where the insurance exposure was higher, caused insured losses of around €250 million,” said Fitch.