AXIS Capital Estimate Q4 Losses Of $130M
Bermuda-based AXIS Capital Holdings Limited announced that its preliminary estimate of the total net financial impact from fourth quarter 2017 catastrophe and weather-related losses is $130 million, net of tax and estimated recoveries from reinsurance and retrocessional covers, and including the impact of estimated reinstatement premiums.
This estimate updates the $35 million to $45 million initial range to $54 million related to the October 2017 Northern California wildfires previously disclosed by the Company in its Quarterly Report on Form 10-Q for the 2017 third quarter and includes a preliminary estimate of $38 million related to the recent wildfires in Southern California as well as $38 million related to other events. Other event losses are primarily attributable to an aggregate excess of loss reinsurance cover which was impacted by various 2017 catastrophe and weather-related events.
The company also commented on the U.S. Tax Reform, saying a result of the reduction in the U.S. corporate income tax rate from 35% to 21% enacted as part of the Tax Cuts and Jobs Act of 2017, AXIS Capital expects to recognize a tax charge in the fourth quarter of 2017 related to the revaluation of its net Deferred Tax Asset.
This charge is estimated to be approximately $42 million and will not affect the Company’s non-GAAP operating net income, a non-GAAP financial measure. Based on its preliminary assessment, the Company does not currently expect U.S. Tax Reform to have a material impact going forward on its net income.
AXIS Capital’s preliminary assessment of the impact of U.S. Tax Reform is based upon the Company’s current interpretation of U.S. Tax Reform, however, the ultimate impact of U.S. Tax Reform on the Company may vary as interpretive regulatory guidance on the new law is issued and corrective or supplemental legislation is enacted.
