AXA reduces XL cat exposure by 40%

French insurer AXA and XL Group have reduced potential catastrophe impacts by around 40 percent relative to 2017 ahead of the merger of the two entities, according to AXA’s first half 2018 earnings presentation.

AXA is in the process of acquiring XL Group for $15.3 billion (€12.4 billion) in cash.

In order to reduce potential negative earnings impacts from natural events, the companies have taken underwriting actions and purchased incremental reinsurance protection at XL.

The firms bought tailor-made aggregate protection for both AXA and XL. As a result, the nat cat exposure across 1/10y to 1/50y return periods is “relatively stable,” according to the presentation.

AXA expects to close the XL acquisition in the second half of 2018.

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