IPC has announced that it anticipates the net impact of Hurricane Katrina losses on net income in the third quarter to be in the range of...

IPC has announced that it anticipates the net impact of Hurricane Katrina losses on its net income in the third quarter to be in the range of $350m to $600m.

The property catastrophe specialist described Katrina as “potentially the largest property loss in insurance and reinsurance history”.

IPC calculated its estimate based on industry insured loss estimates, including marine and offshore energy losses, of $30bn to $40bn. For the basis of the calculation the company has also assumed that underlying policy terms and conditions are upheld during the loss adjustment process.

IPC said that the uncertainty surrounding such a complex loss has been compounded by the potential for legal and regulatory issues arising regarding the scope of coverage. Consequently, it warned that the ultimate net impact of Hurricane Katrina losses on its net income might differ “substantially” from the range suggested.

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