WATERLOO, ON, May 11, 2016 /CNW/ - Economical Insurance today released its initial catastrophe loss estimate from the Fort McMurray wildfire.
"The damage resulting from this catastrophic fire underscores the importance of our promise to our customers to be there when they need us most," said Karen Gavan, President and CEO. "Our first priority is to our policyholders. We quickly mobilized our catastrophe response team and are providing emergency funding to our policyholders to help them with their immediate needs. We will continue to take care of our policyholders as they deal with the significant suffering this catastrophe has caused and move forward with rebuilding their lives."
We initially estimate that our pre-tax loss related to this catastrophe will be $35 to $45 million, net of reinsurance recoveries and reinstatement premiums. Our catastrophe reinsurance coverage commences once losses reach $30 million on an individual loss event. We will record the loss related to this catastrophe in our second quarter results.
Our initial loss estimate is based primarily on claims reported to date, known exposures in the area, and reported percentage losses in various parts of the community. In addition, there is currently no direct access to the area, losses within an area can vary from one street to the next and the fire is still ongoing. It also assumes that this wildfire does not return to Fort McMurray. Consequently, the ultimate loss we incur may differ from our initial estimate.
Forward looking statements
Certain of the statements in this press release regarding our current and future losses, plans, expectations and intentions, results, levels of activity, performance, goals or achievements, or any other future events or developments constitute forward-looking statements. The words "may", "will", "would", "should", "could", "expects", "plans", "intends", "trends", "indications", "anticipates", "believes", "estimates", "predicts", "likely", "looking to", or "potential" or the negative or other variations of these words or other similar or comparable words or phrases, are intended to identify forward-looking statements.
Forward-looking statements are based on estimates and assumptions made by management based on management's experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management believes are appropriate in the circumstances. Many factors could cause Economical's actual results, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the following factors: the competitive market environment; Economical's ability to appropriately price its products to produce an acceptable return; its ability to accurately assess the risks associated with the insurance policies that it writes; its ability to pay claims in accordance with our insurance policies; management's ability to accurately predict future claims frequency or severity including the frequency and severity of weather related events; the occurrence of unpredictable catastrophic events; Economical's ability to obtain reinsurance coverage to alleviate risk; Economical's ability to successfully manage credit risk from its counterparties; unfavourable capital market developments or other factors which may affect our investments; general economic, financial and political conditions; foreign currency fluctuations; Economical's ability to implement its strategy or operate its business as management currently expects; Economical's dependence on key employees; Economical's reliance on independent brokers to sell its products; Economical's ability to meet payment obligations as they become due; the risk of financial loss from an inadequate enterprise risk management framework; Economical's ability to manage the appropriate collection and storage of information; Economical's reliance on information technology and telecommunications systems; changes in government regulations; supervisory expectations or requirements, including risk-based capital guidelines; litigation and regulatory actions; success and timing of the demutualization process; the outcome of a demutualization transaction; periodic negative publicity regarding the insurance industry or Economical; Economical's ability to uphold its independent third party ratings; and Economical's ability to respond to events impacting its ability to conduct business as normal.
All of the forward-looking statements included in this press release are qualified by these cautionary statements. These factors are not intended to represent a complete list of the factors that could impact Economical, however, these factors should be considered carefully, and readers should not place undue reliance on forward-looking statements we make. We are under no obligation and have no intention to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
About Economical Insurance
Founded in 1871, Economical Insurance is one of Canada's leading property and casualty insurers, with more than $2.0 billion in annualized premium volume and $5.3 billion in assets as at March 31, 2016. Based in Waterloo, this Canadian-owned and operated company services the insurance needs of more than one million customers across the country.
SOURCE Economical Insurance
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For further information: Media Inquiries: Doug Maybee, Manager, Public and Media Relations, Economical Insurance, (T) 519.570.8249, (C) 519.404.0989, [email protected]; Stakeholder Relations Inquiries: Max Weis, Vice-President, Corporate Development, Economical Insurance, (T) 519.570.8291 (Waterloo), (T) 647.260.3679 (Toronto), [email protected]