Intact sees its losses from Alberta wildfire at C$130-C$160 mln

Mon May 9, 2016 11:37am EDT
 
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By Matt Scuffham

TORONTO May 9 (Reuters) - Intact Financial Corp, Canada's largest property and casualty insurer, said on Monday it will suffer losses ranging from C$130 million ($100 million) to C$160 million ($123 million) from the massive wildfire in the Alberta oil city of Fort McMurray.

The company said the estimate, equivalent to between C$1 and C$1.20 per Intact share, was based on satellite imagery and geocoding technology that enabled company officials to see if buildings were a total loss or partially destroyed.

It said the estimate was all-inclusive, including rebuilding and restoring properties, providing living expenses to customers who have lost homes and covering interruption to businesses.

The estimate was not as bad as some analysts had feared and shares in Intact were up 0.6 percent.

Barclays analyst John Aiken said the forecast from Intact, which has a market share of roughly 15 percent in the region, implied overall industry losses of between C$1 billion and C$1.1 billion.

Aiken said reinsurance, which insurers buy to help protect against the risk of outsized losses from major disasters, began to kick in at about C$100 million in losses for Intact. Other insurers may not have the same protection and, consequently, he anticipated industry losses would be "significantly above C$1 billion".

BMO analyst Tom MacKinnon said last week that overall losses from the fire could cost insurers as much as C$9 billion, although he said a "more reasonable estimate" would be between C$2.6 billion and C$4.7 billion.

Most analysts had expected the fire to result in the largest catastrophic loss in Canadian history, ahead of the C$1.9 billion in losses from the North American ice storm of 1998 and the Alberta floods of 2013. ($1 = 1.2975 Canadian dollars) (Editing by Jeffrey Benkoe)