Hannover Re expects minimal exposure to losses from the coronavirus outbreak, CEO Jean-Jacques Henchoz said in a press conference call last week.
Henchoz said it was too early to assess losses, Hannover Re’s management was confident the company had limited exposure to pandemic risk in Asia and business interruption losses related to infectious disease. According to Reinsurance News Henchoz did “not expect any significant exposure for Hannover Re.
“We are not aware of any coronavirus related claims, but we still need a bit of time until we have the full picture,” he said. “We are not aware of any travel insurance related losses nor any exposure from the aviation business.”
Henchoz made the statement on the release of Hannover Re’s property and casualty (P&C) treaty renewal results, which showed renewals as at January 1 delivered a 14% premium increase.
Of the total premium volume booked in the previous year at €10.5bn ($A17.2bn), €7.05bn – or 67% of the business – were up for renewal. Of that, €6.3bn was renewed, while treaties worth €1.7bn were either cancelled or renewed in modified form.
That included increases of €810m from new treaties and from changes in prices and treaty shares, the total renewed premium volume was €11.5bn.
The strongest renewal growth, at 15.5%, was derived from proportional reinsurance, which generated a renewed €6.03bn premium volume on a 2.1% price increase. The renewed premium volume in non-proportional reinsurance grew by 9.7%, to €2bn on a 2.9% price increase.
Henchoz said the coronavirus would have to develop into a far more deadly outbreak than SARS for it to really affect the Hannover Re’s mortality business.
Executive board member Sven Althoff said in P&C coverage for non-damage business interruption resulting from infectious disease was mostly excluded, including for aviation and property business.
Rating agency AM Best reported last week that reinsurers are likely to face higher levels of risk related to the coronavirus because of their higher exposure to mortality and morbidity risks.
On January 30, the World Health Organization declared the coronavirus outbreak a “public health emergency of international concern”.
According to the Department of Health, by today (February 10) there had been about 37,562 confirmed coronavirus cases worldwide and 813 reported deaths. The fatality rate was now 2.16%.
In Australia, there were 15 confirmed cases – five in Qld; four in NSW; four in Vic; and two in SA.
So far, 532 Australians had returned to Australia. They were now in quarantine on Christmas Island or at the Howard Springs Accommodation Facility on the outskirts of Darwin.
Currently, only two deaths have been recorded outside of China, but the virus has spread to at least 28 other countries besides China and Australia, including the USA, the UK, France, Japan, Canada and South Korea, sparking fears of a global crisis.
The coronavirus cases worldwide has surpassed the 2003 SARS epidemic, but the death toll still remained below the 774 documented over the SARS outbreak which lasted for about six monhs.