Swiss Re has posted a first-quarter loss and revealed a $US476 million ($736.93 million) charge in preparation for claims relating to COVID-19, particularly event cancellations.

Market volatility has wiped $US300 million ($463.97 million) from Swiss Re’s investments, although prudent hedging prevented a much larger decline.

Large natural catastrophe losses of $US397 million ($615.48 million) were higher than expected and reflected hailstorms and significant flooding in Australia on top of major bushfire losses already reserved for last year.

“Swiss Re’s business remains resilient despite the financial impact of the crisis on our results,” said CEO Christian Mumenthaler. “We will weather this situation as a strong partner for our clients.”

Mr Mumenthaler says the COVID-19 pandemic will have far-reaching consequences for society and the broader economy, and preparation for future crises is likely to be found in collaboration between governments and industry.

“In the longer term we will need to draw lessons from the current situation and look at public-private partnership solutions to ensure society can better deal with such large-scale disruptive events in the future,” he said.

Swiss Re reported a $US225 million ($337.98 million) first-quarter loss, compared with a net profit of $US429 million ($663.51 million) in the corresponding period last year. Excluding the impact of the reserves established for COVID-19 related claims, a profit of $US158 million ($244.33 million) was calculated.

The Property & Casualty (P&C) combined ratio was 110.8% in the first quarter, up from 110.3% a year earlier. Excluding claims related to COVID-19 the ratio was 105.5%.

P&C Re reported a net income of $US61 million ($94.36 million) for the quarter, which was profitable despite charges related to COVID-19 and natural catastrophes. The COVID-19 crisis impacted the P&C result by $US253 million ($391.37 million) as reserves were established, primarily for expected claims for cancelled or postponed events.

P&C Re’s net premiums earned increased strongly by 12% to USD 4.7 billion.

April renewals showed P&C Re achieved a nominal price increase of 8%, with a strong increase on Japan windstorm risk.