The Hanover estimates Q4 catastrophe losses of $190M before taxes

The Hanover Insurance Group announced a preliminary estimate for fourth quarter catastrophe losses of approximately $190M, before taxes, or 13.9 points of net earned premiums. The estimate is approximately $137M above the company’s pre-tax fourth quarter catastrophe assumption, driven by the effects of Winter Storm Elliott, which accounted for approximately $165M, before taxes, of overall catastrophe losses in the quarter and primarily impacted the company’s core commercial business. "We have a robust track record of successful catastrophe exposure management, risk modeling and portfolio diversification initiatives, as demonstrated by our relatively low catastrophe losses from hurricanes and other traditional perils in the recent years. And, we are confident in our ability to address winter weather and water-related events through pricing, risk management and other innovative tools effectively," said CEO John Roche. "Looking beyond catastrophes, we successfully advanced our action plans towards recapturing target margins in property lines, achieving double digit renewal price increases in all three business segments in the fourth quarter." The Hanover expects its fourth quarter combined ratio, excluding catastrophes, to be 94.1%. As a result, the company expects its full year combined ratio, excluding catastrophes, to be 92.1%, consistent with the outlook range of 92.0% to 92.5% provided on its third quarter earnings call. Taking this and other currently available information into account, The Hanover expects to report an after-tax net loss per share of $0.33 and operating loss per share of $1.05 for the fourth quarter.