Swiss Re sees hit of less than $700 million from Los Angeles wildfires

(Reuters) — Swiss Re said Thursday that claims from wildfires in Los Angeles would be less than $700 million, the latest European reinsurer to disclose a hit from the January blaze.

The wildfires killed more than two dozen people and destroyed or damaged more than 16,000 structures, charring an area bigger than Paris.

Swiss Re’s expected claims are less than those foreseen by its larger competitor Munich Re, which said Wednesday it was factoring in about €1.2 billion ($1.26 billion) in losses, representing the biggest hit reported so far by a single European reinsurer for the catastrophe.

Analysts have estimated insurance claims across the industry for the wildfires could total as much as $45 billion. Hannover Re has said it could face claims totaling €700 million.

Credit ratings company Fitch has said that European insurers had reduced exposure to California after a spate of fires in 2017 and 2018 but would still be “materially affected by this year’s fires because of their scale.

Swiss Re provided the estimate as part of its 2024 earnings report, which showed a 3.1% rise in net profit from the previous year.

Net profit was $3.24 billion, compared with $3.14 billion in 2023. Analysts had expected a profit of $3.13 billion, according to a consensus forecast.