Both commercial and personal line results fluctuated due to the ongoing Covid-19 pandemic
Insurer AXA has reported a total revenue of €38bn for its property and casualty (P&C) business across the first nine months of 2020 – this includes a 2% uptick in commercial lines for the third quarter as the business recovered from the impact of the Covid-19 lockdown.
In its trading update, published on 3 November, AXA noted that its commercial line revenue remained stable at €24.5bn, however revenue movements have fluctuated over the course of the year due to the effects of the coronavirus pandemic. Despite seeing a 5% growth in the first quarter, AXA were hit by a 10% decline in the second quarter as a result of the pandemic lockdown. In Q3, the business has seen a slight 2% uptick.
These movements were largely driven by higher revenues in AXA XL – influenced by underwriting decisions and the reduced activities of insureds due to coronavirus – as well as lower revenues at AXA XL Reinsurance.
Thomas Buberl, chief executive of AXA, said: “The third quarter rebound in our business reflects the continued intensive engagement of our employees and distribution partners, embracing new ways of working and staying close to our clients during these challenging times.
“I would like to thank them for this. I would also like to thank AXA’s 108 million clients for their trust and loyalty. We will continue doing our very best to support them in this uncertain environment.”
As for personal lines, AXA’s revenue decreased by 1% to €13.4bn, again as a result of the Covid-19 pandemic.
The update further confirmed that AXA expects only a “limited impact” in terms of Covid-19-related claims that are linked to the second wave of lockdowns, such as the one confirmed in the UK from Thursday 5 November.
Therefore, the business maintained its current best estimate “for the impact on 2020 underlying earnings for the group from Covid-19 related P&C claims and solidarity measures remains at €1.5bn (post-tax and net of reinsurance), consistent with the group’s June 3, 2020 announcement and confirmed in the group’s 1H20 results released on August 6, 2020.”
Buberl added: “AXA expects only a limited impact on claims from the current second wave of lockdowns and has reaffirmed today its current best estimate of €1.5bn Covid-19 claims for 2020.”
Across the AXA group, total revenues have declined by 2% in the first nine months of 2020 compared to the same period last year, standing at €73.4bn compared to €79.7bn last year.
In the UK and Ireland, AXA’s P&C operations had a revenue of €2.6bn in the first nine months of 2020, a 1% decrease on the same period last year. Revenues dipped in personal non-motor and commercial motor in particular.
Buberl said: “AXA’s strategic choices in recent years, favouring technical risks over financial risks, have positioned the group well for the future and are confirmed by the group’s strong performance in the context of Covid-19.
“The group recorded a dynamic rebound of revenues in the third quarter, with our preferred segments, P&C commercial lines, health and protection growing by 3%.”