Insurance

Major reinsurer reports more than $500m in COVID-19 losses for 2Q 2020

By Amir Sadiq

SCOR has announced that the COVID-19 pandemic will cost it an estimated EUR456m ($530m) net of retrocession and before tax in 2Q2020.

The total amount comprises EUR248m on its P&C side, EUR194m on its life side and EUR14m on its investment side.

On the P&C side, the Group’s exposure came mainly from credit, surety and political risks and from property business interruption. The actual COVID-19-related claims received were limited, standing at a total of EUR74m.

Regarding property business interruption, SCOR estimated that its exposures relate to a very small amount of affirmative pandemic coverage and non-damage business interruption, mostly in Western Europe, with non-damage business interruption scarce in the US and largely sub-limited in APAC.

SCOR noted that uncertainty in terms of estimating the cost of this business interruption arises from aggregation for this small amount of affirmative coverage and confirmation of these estimates will have to wait until the second half of the year.

On the life side, the actual COVID-19-related claims received as at 30 June 2020 were limited, standing at a total of EUR63m.

SCOR’s main life exposure came from the US where it has booked a claim reserve provision of EUR182m to cover COVID-19-related claims up to 30 June 2020. A further EUR12m of COVID-19-related claims were booked in Europe and Asia Pacific in 2Q2020.

“Estimated impacts rely heavily on expert judgment as each month of claims takes on average six calendar months to be fully reported,” it said.

SCOR said that it continues to maintain a strong capital position despite absorbing the COVID-19 losses, with the Group’s total liquidity standing at EUR2.8bn on 30 June 2020.

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