Hiscox expects to pay net claims totalling up to $150 million against events that have been cancelled in the media and entertainment, travel and other segments, the re/insurer has said.
The expected claims cover a six month period starting in March 2020. If more events are cancelled beyond this period, Hiscox predicts claims could increase by an additional $25 million.
Hiscox is also receiving claims as a result of economic losses following government action to stop the spread of COVID-19. However, it noted the small commercial package policies written by Hiscox UK do not provide cover for business interruption as a result of the general measures taken by the UK government in response to a pandemic.
Hiscox therefore believes its business interruption exposure to COVID-19 is limited in Hiscox Europe, and negligible in Hiscox USA. “Hiscox’s capital, liquidity and funding positions remain robust and the group remains operationally strong in the face of unprecedented global uncertainty presented by the COVID-19 pandemic,” it said.
Hiscox added it “recognises these are extremely difficult times for businesses and is determined to help provide greater certainty for customers.” It promised to work with the UK insurance industry, regulators and customers to find a resolution “through the range of independent mechanisms available.”
Hiscox, Business interruption, COVID-19