Venezuela Earthquakes Cost Mapfre Up to €25 Million in Claims

Int’l Desk: Spanish insurer Mapfre has put the cost of claims from the powerful earthquakes that struck Venezuela on June 24 at up to €25 million. The figure came as the company released its first half results on Thursday and reported solid overall performance despite several other weather related hits.

According to details carried by Insurance Journal, the estimate covers the group’s exposure through its reinsurance arm Mapfre Re and its Global Risk unit.

Officials described the number as a conservative calculation based on information available so far and noted that reserves have been set at the higher end of the expected range.

The twin quakes, measuring roughly 7.5 and 7.2 in magnitude, caused widespread destruction along the northern coast, especially in La Guaira state, which was declared a disaster zone.

National damage assessments from international bodies have run into the billions of dollars, yet Mapfre’s share remains limited given its specific book of business in the country.

The announcement arrived alongside news that Mapfre’s net profit for the first six months of the year rose 9.4 percent to €624 million. Premiums increased modestly, while the non-life combined ratio improved slightly.

Storms that hit Spain and Portugal earlier in the year produced claims of around €50 million, but those were absorbed without major disruption.

Results in Turkey faced pressure from flooding, currency depreciation and hyperinflation adjustments, yet the group still described itself as on track to meet its longer term targets.

Mapfre also used the same day to confirm its planned $1.54 billion purchase of the American property and casualty insurer Safety Insurance.

Executives said the deal would add value from the outset and lift net profit by about five percent once integration is complete. Shares of the Spanish group nonetheless dipped on the day as investors digested the mixed picture of catastrophe costs and expansion moves.

The Venezuela estimate underscores how even large natural disasters can produce contained losses for international carriers when their local exposure is tightly managed.

Mapfre has operated in the country for years and activated its crisis committee immediately after the quakes to assess damage and support clients.

With the conservative provision already booked, the company indicated it expects limited further impact from the event as the second half of the year unfolds.