Peter Zaffino, chief executive of AIG’s GI business, believes that claims stemming from Japan’s Typhoon Hagibis are lower than expected.
Super Typhoon Hagibis, Japan’s 19th of the season, made landfall in October – it was the most powerful storm to hit the country in 60 years. Hagibis generated maximum winds of up to 225km/h (140mph), which is the equivalent of a Category 3 Atlantic hurricane. It came right after Typhoon Faxai barrelled through Japan in September.
Though specific figures on Hagibis losses are not yet available, Zaffino commented at press conference on December 10: “The claims count is coming in lower than we expected at this stage.”
Previously, Credit Suisse analysts predicted that AIG’s Japan division could exceed its catastrophe limit due to Hagibis – stating that the insurer has likely used close to its Japan US$550 million reinsurance cover. Some estimates predicted Hagibis costs at US$10 billion – which would have meant US$600 million of catastrophe losses for AIG prior to reinsurance.
Catastrophe risk modelling firm RMS estimated insured losses for the market from Hagibis between US$7 billion to US$11 billion. The combined losses from Hagibis and Faxai has made the former a difficult event to model. Zaffino reinforced RMS’ sentiments: “It’s a very complicated typhoon.”
Claims related to wind look to be at the forefront; while flooding-related claims have been more difficult to estimate due to the Faxai and other heavy rainfall events.
Chief executive of AIG Brian Duperreault added on the Japan market: “In terms of the loss ratio, there’s enough margin to price for catastrophes.”
AIG in recent years, have undertaken a reinsurance transition in risk management due to a few difficult years of high catastrophe losses.

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