(Bloomberg) --
Swiss Re reported a net loss of about $1.1 billion in the first half, driven by claims related to the coronavirus pandemic.
Covid-related claims and reserves totaled $2.5 billion in the first six months, the company said in a statement late Wednesday. That includes $476 million of losses booked in the first quarter, mostly from canceled events.
Chief Financial Officer John Dacey said first-half claims and reserves -- money set aside against potential future payouts -- should cover the “majority” of the firm's ultimate losses from the outbreak.
Lloyd's of London has estimated that the insurance industry will suffer about $203 billion in losses from the pandemic this year, with about $107 billion coming from underwriting claims and the rest from insurers' investment portfolios. Munich Re reported Covid-related losses of about 700 million euros ($810 million) in reinsurance in the second quarter, mostly from major events that were called off.
Swiss Re declined as much as 2.8% in early Zurich trading and were down 2.6% as of 9:13 a.m. at 75 Swiss francs per share. The stock has dropped by about 31% this year.
Swiss Re also announced the completion of the sale of its ReAssure Group Plc subsidiary to Phoenix Group Holdings Plc. The Swiss reinsurer received 1.2 billion pounds ($1.5 billion) and a 13.3% stake in Phoenix as part of the deal. The sale bolstered Swiss Re's capital position, which the firm said “remains very strong” despite the impact of the pandemic.
Phoenix to Buy ReAssure From Swiss Re in $4.3 Billion Deal (3)
“The underlying performance of all our businesses is strong, and they continue to deliver on their strategic objectives, such as the completion of the ReAssure sale,” Dacey said.
Swiss Re will publish full first-half results on July 31.
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