Shares of Beazley PLC (LON: BEZ) plunged more than 15% today after the specialist insurer said that insurance claims related to the impact of the pandemic rose to $340 million.
Event cancellations are mostly to blame for the rise in insurance claims as nations prepare for difficult autumn. The insurer hopes that countries will go back to normality by the mid-2021. If this is not the case, Beazley fears that the claims number could eventually rise to nearly $400 million.
“As our book of business is heavily weighted to the US and UK with largest segment being conferences, our clients are still largely unable to operate as restrictions on holding events persist,” the company said in a trading statement today.
The company projects a $123 million drop in full-year profit before tax. Eventually, Beazley forecasts to report a $55 million loss.
“The magnitude of the increase is somewhat surprising and we believe reflects an exhaustion of the reinsurance cover,” said analysts at JP Morgan.
Beazley share price plunged over 15% to trade below 330p for the first time since May.
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