Hurricane Charley Losses Estimated at $8 Million by American Financial Group

Strategic Insights -

American Financial Group Inc., parent of Great American Insurance Co., estimates its after-tax losses from Hurricane Charley will be approximately $8 million after it recoups some losses from reinsurance. The company expects the bulk of claims reported so far are from commercial policies covering businesses in Florida. The estimated losses will reduce earnings per share by about 10 cents, but the company still expects 2004 core earnings per share, including hurricane losses, to be between $2.85 and $3.10.

Key Takeaways:

  • American Financial Group Inc. estimates its after-tax losses from Hurricane Charley to be approximately $8 million after recouping some losses from reinsurance.
  • The company expects the bulk of claims reported so far are from commercial policies covering businesses in Florida.
  • The estimated losses will reduce earnings per share by about 10 cents.
  • The company still expects 2004 core earnings per share, including hurricane losses, to be between $2.85 and $3.10.
  • Great American's property and casualty insurance business focuses on specialized commercial products for businesses.
  • Cincinnati-based property and casualty insurance companies also have estimated hurricane-related losses: $25 million before taxes by Cincinnati Financial Corp. and between $6 million and $8 million before taxes by Ohio Casualty Corp.
  • Midland said initial claims were about $4 million in the days after the storm struck, with other claims delayed by power outages and the absence of many Florida property owners during the summer.

Statistics:

  • Estimated after-tax losses from Hurricane Charley: $8 million
  • Reduction in earnings per share: 10 cents
  • Expected 2004 core earnings per share: $2.85 - $3.10
  • Initial claims: $4 million
  • Cincinnati Financial Corp.'s estimated hurricane-related losses: $25 million (before taxes)
  • Ohio Casualty Corp.'s estimated hurricane-related losses: $6 million - $8 million (before taxes)

Sources:

  • American Financial Group Inc.
  • Great American Insurance Co.
  • Cincinnati Financial Corp.
  • Ohio Casualty Corp.