U.S. P&C Insurers Face 'Limited Exposures' from Coronavirus
Carefully worded policy exclusions will help limit P&C insurers' risks — but not entirely.
COVID-19, the now-declared pandemic by the World Health Organization (WHO), has infected more than 118,000 people across 114 countries and has caused significant disruptions across the global insurance industry. While the virus will undoubtedly impact the health and life insurance markets, the U.S. property & casualty (P&C) sector may emerge relatively unscathed once the pandemic subsides, says recent rating agencies’ analyses.
According to Moody’s, global P&C commercial lines exposure is limited with modest insured losses relative to economic losses. For the U.S. market, Fitch Ratings explains that the virus outbreak will unlikely have an “adverse impact on financial results reported by U.S. P&C companies, nor their ratings. The nature of insured commercial exposures, along with restrictive language embedded in policy contracts, will likely limit U.S. P&C companies from a material level of claims.”
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