Everest Re 'resilient' despite $150m Q1 COVID-19 losses

Bermuda-based re/insurer Everest Re Group is expecting $150 million net first party losses (pre-tax) from COVID-19-related claims activity. Chief executive Juan Andrade highlighted that the company's "capital position remains a source of strength" during the pandemic.

The company has estimated impact from the COVID-19 pandemic on its first quarter 2020 results.

The majority of the $150 million pandemic-related losses are expected to come from the reinsurance segment.

Everest noted that since the start of the economic crisis, the company has further repositioned its portfolio, moving up in fixed income credit quality and reducing equity exposure.

It said that the company's balance sheet, including our investment portfolio, is well-diversified, with a focus on high quality fixed income investments. Hoever, Everest anticipates the pandemic to have a "meaningful impact on revenue, as well as net and operating income in future quarters as a result of reinsurance and insurance claims due to the pandemic and resulting macro-economic market conditions".

The re/insurer is expecting a combined ratio below 100 percent for the consolidated reinsurance and insurance operations. Net investment income is expected to be $148 million for the first quarter of 2020.

Andrade, Everest president and CEO, said: “As the situation surrounding the COVID-19 pandemic continues to evolve, our thoughts are with everyone who has been impacted around the globe. Everest remains committed to supporting our clients, communities, and trading partners. These are unprecedented times, and our first priority is the safety of our employees, business partners, other stakeholders and their families. Our entire organization has been working remotely, continuing to serve our customers with the same high level of service that they have come to expect.

"Our capital position remains a source of strength, with high quality invested assets, significant liquidity, low financial leverage, and a low operating expense ratio. Our diversified global platform with its broad mix of products, distribution and geography is resilient.”