By James McNair
Enquirer staff writer
Cincinnati Financial Corp. said Thursday it will incur up to 51 percent more than expected in storm-related losses in 2004, even before factoring in claim payouts from Hurricane Jeanne.
The Fairfield company, the biggest property and casualty insurer based in Greater Cincinnati, estimates it will lose $13 million from Hurricane Frances claim payouts and, preliminarily, $36 million from Hurricane Ivan. Combined with payouts for Hurricane Charley, Tropical Storm Gaston and a July windstorm in Illinois, the estimated losses from Frances and Ivan up the company's third-quarter pretax catastrophic losses to $89 million.
Cincinnati Financial had estimated catastrophic losses of $90 million to $100 million for the entire year. Having paid out $47 million for catastrophes in the first half of 2004, the company now estimates those losses to stand at $136 million. The company does not know when it will calculate estimated losses from Hurricane Jeanne, which slammed into Florida's Treasure Coast with category 3 winds Sunday, causing an estimated $6 billion to $8 billion in damage.
Cincinnati Financial's loss estimates are net of the company's own reinsurance coverage. The company expects to make more claim payouts to Ivan victims, but said it will be responsible for only 5 percent of the additional losses, with the rest picked up by its reinsurance carriers.
"More than 100 experienced Cincinnati claims representatives have traveled to Alabama and Florida over the course of the past seven weeks to work with our local staff, making certain that personal lines and commercial lines policyholders receive immediate assistance," said Cincinnati financial CEO John Schiff Jr.
Shares in Cincinnati Financial closed Thursday at $41.22, up 67 cents.
Also Thursday, Cincinnati-based American Financial Group announced an estimated loss of $5 million from Hurricane Ivan. Including hurricanes Charley and Frances, hurricane losses so far this year have totaled about $18 million, the company said. It does not yet have a loss estimate for Hurricane Jeanne.
The company lowered its earnings estimate to a range of $2.75 to $2.90 per share. It had previously estimated full-year earnings of $2.85 to $3.10 per share.
Shares in AFG closed Thursday at $29.89, up 37 cents.
Staff writer Cliff Peale contributed. E-mail jmcnair@enquirer.com
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