This is despite continued uncertainty around how the loss will play, with several firms yet to put a number on their likely exposures.
The event is expected to become a record loss for the marine market, with estimates of the market impact ranging from $1.5bn to as much as $4bn.
But as Munich Re CFO Christoph Jurecka said last week, the event is highly complex with a range of estimates “significantly higher” than is typically the case for man-made losses.
Jurecka said publicly disclosing a number would be misleading given that “it would signal that we understand the situation, which we frankly do not very well at this point in time”.
Those (re)insurers that have provided commentary around their expected impacts from the event have been consistent in highlighting that their losses will likely fall within expectations for an event of this size.
As the table below highlights, several carriers have acknowledged some exposure to the Baltimore bridge event in their first quarter earnings announcements.
RenaissanceRe, Fidelis, Hamilton, Axis, Ark and Greenlight Re have all now put a number on their exposures, with RenRe and Fidelis having the largest net impacts to date at $55mn and $51.2mn respectively.
Hamilton booked a $37.9mn impact from the bridge collapse in its Q1 results, adding 3.6 points to its combined ratio.
Axis and Ark have estimated their losses at $19mn and $15mn, with Greenlight Re booking a full limit loss of £10.1mn.
Several others have sought to reassure investors over their likely impacts, with Hiscox describing expected losses as “moderate”, while Aspen and Lancashire said they were “within expectations”. Markel said there was nothing “unusual or outsized” about the event. Axa said its exposures would be “non-material at group level” at less than €100mn ($108mn). SiriusPoint said it had no material exposure.
While a Wall Street Journal report has said Chubb – which leads the property policy for the bridge – is to pay out $350mn to the State of Maryland, this has not been confirmed by the carrier.
Collapsed bridge affects many lines of business
The collapse was caused by the container vessel Dali striking one of the bridge’s support columns.
Losses from the bridge collapse will include costs associated with repairs to the vessel, repairs to the bridge, business interruption at the port of Baltimore, loss of life and injury, among others.
The Dali’s owner Grace Ocean and manager Synergy Marine are seeking to limit their liability to $43.67mn under an 1851 maritime law.
According to a Gallagher Specialty report, the determination of limitation will be “a lengthy legal process and one subject to various levels of appeal whatever the initial verdict.”
If the limitation petition is ultimately successful, the loss will be shared across several lines of insurance. If not, much of the loss is likely to be subrogated to the P&I claim.
The Dali has its P&I registered with Britannia P&I Club, with the bulk of any claim to fall on the International Group of P&I Clubs and its reinsurers. Axa XL is the lead on the IG’s $3.1bn pooling and group excess of loss reinsurance program.
Record marine loss
Estimates for the overall insured loss from the event range from $1bn to $4bn. The previous largest marine loss was the sinking of the Costa Concordia in 2012, which saw losses of around $1.5bn, of which Lloyd’s share was in the region of £200mn. Members agent Argenta has estimated Lloyd’s bill from the Baltimore loss will exceed its loss from Costa Concordia.
The IG’s reinsurance program covers $3bn in losses per event, above the $100mn covered by the P&I clubs. If the loss exceeds $3.1bn, additional costs will be mutually shared across IG clubs, with levies on the ship owners to pay these claims.
Rating agency S&P said: “We anticipate that the protection and indemnity (P&I) clubs, Axa XL, and the global reinsurance sector will be able to manage their losses with no impact on ratings at this stage.”
The longer-term impact on marine market dynamics is still to be determined, with Marsh’s Jim Matthews suggesting underwriters “want to see what’s going to happen” first. Gallagher Re CEO and chairman Pat Gallagher commented that the event “may cause reinsurance carriers [to establish] more pricing resolve throughout the rest of the year.”
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