Losses

The downgrade comes following the carrier’s disclosure of impacts from a worsening tort environment.

The broker estimates Hagibis losses at $8bn and Faxai claims at $7bn.

The fast-escalating claims costs come as insurers contend with hefty bushfire losses.

The carrier expects to book a Q4 P&C loss ratio of between 134 percent and 148 percent.

The broker’s estimate is more than a third higher than Munich Re's $52bn insured loss tally.

The Insurance Council of Australia has tracked A$407mn ($279mn) of claims from the storms, which may impact aggregate reinsurance covers.

The carrier is to book $140mn of weather-related losses and $29mn from agricultural reinsurance.

More claims are expected to be lodged by homeowners as they inspect damage this week.

No loss was large enough to breach the per-occurrence limits of the carrier’s reinsurance treaties.

The carrier says the claims outstrip expectations by $20mn as it predicts a Q4 combined ratio of up to 96.5 percent.

The American insurer also takes a $51mn pre-tax charge from the phase-out of its Esurance brand.