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Insurers count cost of hurricanes

Losses from the hurricanes that devastated the Caribbean and US states of Texas and Florida are running into the billions, according to estimates from major insurers.

XL Group and AIG warned last week the bill will affect their third-quarter results, echoing similar predictions from other insurers.

XL Group expects preliminary net losses of $US1.33 billion ($1.69 billion) from hurricanes Harvey, Irma and Maria. Total after-tax net catastrophe losses for the September quarter are about $US1.35 billion ($1.71 billion).

AIG estimates pre-tax catastrophe losses of $US1.1-$U1.2 billion ($1.39-$1.42 billion), plus another $US150 million ($190 million) from the Mexico earthquakes.

Chubb expects Hurricane Maria, which inflicted the most damage in Puerto Rico, to result in pre-tax net insurance and net reinsurance losses of $US220 million ($278.68 million), while the two Mexican quakes will total about $US25 million ($31.7 million) in pre-tax insured losses.

It says insured losses of up to $US1.28 billion ($1.62 billion) from hurricanes Harvey and Irma are likely for the third quarter. Harvey will cost $US520 million ($660 million) after tax, and estimates for Irma range from $US640-$US760 million ($812-$965 million).

Lloyd’s has paid about $US738 million ($936 million) in claims related to the three hurricanes.

“We have made advance payments on a range of reinsurance programs for local insurers to make sure they have the funds to pay claims locally – both in Texas and the Caribbean,” Performance Management Director Jon Hancock said.

“Lloyd’s has also made advance insurance payments to businesses so they have funds to kick-start rebuilds and get back on their feet.”