Insurer reports at least Bt1.1-bn loss in Q4

This preliminary loss estimate is based on industry insured losses ranging from $10 billion to $20 billion. 

The company said its preliminary estimate is based on currently available information derived from modelling techniques, industry assessments of exposure, preliminary claims information obtained from the company’s clients and brokers to date and a review of in-force contracts. 

The severe flooding in Thailand spanned several months between July and December 2011 and has had a significant impact on the Thai economy. Due to the size, duration and complexity of the event, substantial uncertainty remains regarding total covered losses for the insurance industry and the assumptions underlying the company’s estimates. Actual losses will depend to a great extent on claims from contingent business interruption coverage. 

The company said actual losses from catastrophic events may vary materially from the estimates due to the inherent uncertainties in making such determinations resulting from several factors. Among the factors are the preliminary nature of available information, potential inaccuracies and inadequacies in the data provided by clients and brokers, the modelling techniques and the application of such techniques, the contingent nature of business interruption exposures, the effects of any resultant demand surge on claims activity and attendant coverage issues. 

In addition, the company said, actual losses may increase if reinsurers fail to meet their obligations to the company or the reinsurance protections are exhausted or are otherwise unavailable. 

Arch Capital Group, a Bermuda-based company with approximately $4.87 billion in capital on September 30, 2011, provides insurance and reinsurance on a worldwide basis through its wholly owned subsidiaries.