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Michael strikes hard; Catalina adds $700M to war chest; Centene's ACA growth

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Michael strikes hard; Catalina adds $700M to war chest; Centene's ACA growth

SNL Image

The aftermath of Hurricane Michael in Panama City, Fla.
Source: Associated Press

Hurricane Michael made landfall near Mexico Beach, Fla., early yesterday afternoon packing maximum sustained winds of 155 mph, making it the most powerful hurricane to hit the U.S. since Hurricane Andrew in 1992. Michael weakened to a tropical storm around midnight ET and continues to move rapidly northeast, with a forecast track showing it passing through central South Carolina, central and eastern North Carolina and southeastern Virginia. The storm is forecast to intensify as it becomes a post-tropical low over the Atlantic late tonight or early Friday, the National Hurricane Center said.

Michael was the third-most powerful hurricane based on barometric pressure ever to make U.S. landfall, behind only Camille and the Labor Day storm of 1935, The Associated Press reported. By wind speed, it ranked as the fourth-most powerful, behind those two and Andrew. At least two people were confirmed to have been killed, the AP said, noting that more than 380,000 homes and businesses were left without power at one stage.

As insurers and reinsurers prepare to disclose the costs of catastrophes that struck during the third quarter, Chubb Ltd. disclosed preliminary estimated losses of $450 million pretax, or $372 million after tax, attributable to natural catastrophes. That was below some analysts' estimates, Artemis wrote.

Centene Corp. plans to enter the Affordable Care Act marketplaces in Pennsylvania, North Carolina, South Carolina and Tennessee in 2019, and will expand its footprint in six other states.

Catalina Holdings (Bermuda) Ltd. completed a US$700 million additional equity capital raise and concluded its shareholder restructuring. Affiliates of Apollo Global Management LLC became majority shareholders of Catalina, with RenaissanceRe Holdings Ltd. a minority shareholder alongside Catalina's management. Catalina CEO Chris Fagan told The Insurance Insider that the new equity will allow the company to compete at the highest end of the legacy deal market.

CVS Health Corp. said it will appoint a new CFO and three new directors to the company's board when it completes its acquisition of Aetna Inc. The U.S. Department of Justice yesterday indicated that it will approve the $69 billion deal once both companies divest their Medicare Part D plans.

Ascot Group Ltd launched Ascot Insurance U.S., an admitted and surplus lines insurance business.

Principal Financial Group Inc. is advising shareholders to reject an unsolicited mini-tender offer from Baker Mills LLC, which is seeking to buy up to 90,000 Principal Financial shares, roughly 0.03% of shares outstanding, from stockholders. Baker Mills has already acquired 222,566 shares through earlier offers.

Dutch insurer ASR Nederland NV said it aims to maintain an operational return on equity of above 12% as part of a new strategy for the 2019-2021 period. The company added that it will pursue "profitable growth in selective areas," including through acquisitions. ASR is not ruling out taking over rival VIVAT NV, according to Dutch newspaper Het Financieele Dagblad.

Danish insurer Tryg A/S today reported third-quarter profit of 627 million kroner, down from 671 million kroner in the year-ago period. Gross premium income rose on a yearly basis to 4.70 billion kroner from 4.58 billion kroner.

U.K.-based Beazley PLC will stop underwriting new construction and engineering business globally, The Insurance Insider reported, citing a company spokesperson.

The Insurance Regulatory and Development Authority of India is said to be in favor of allowing full foreign direct investment in insurance intermediaries such as aggregators and third-party administrators, in addition to insurance brokers, Press Trust of India reported, citing sources. Foreign direct investment in the country's insurance sector is capped at 49%, although the government is considering eliminating that cap for brokers.

And Africa's biggest insurer, Sanlam Ltd., completed the acquisition of the remaining 53.37% stake it did not already own in Morocco-based Saham Finances SA.

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Trump: Fed has 'gone crazy' with interest rate hikes: President Donald Trump took another shot at the Federal Reserve over its gradual rate hikes, saying he thinks the Fed is "making a mistake."

S&P: German life insurers may save up to €18B in 2018 thanks to rule change: A recent government proposal to change the way German life insurers calculate their additional reserve needs could save the industry up to €18 billion in 2018 and will likely boost their solvency ratios in the long run, S&P Global Ratings said.

Novartis MS drug beats Teva's in trial; Bayer could win retrial on Roundup case: Monsanto could win a new trial on the $250 million awarded by a jury over allegations that its weedkiller caused cancer, and Gilenya, in a late-stage study, worked better than Copaxone in reducing the recurrence of a type of multiple sclerosis.

In other parts of the world

Asia-Pacific: China issues anti-money laundering rules; Merrill Lynch Japan behind TSE glitch

Europe: Brexit deal 'within reach'; Natixis eyes Ingenico; Tryg Q3 profit dips YOY

Middle East & Africa: QNB Q3 profit up YOY; Moody's revises outlook on Egypt's banking system

The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, the Hang Seng slipped 3.54% to 25,266.37, and the Nikkei 225 declined 3.89% to 22,590.86.

In Europe, around midday, the FTSE 100 was down 1.65% to 7,027.61, and the Euronext 100 fell 1.70% to 991.57.

Click here to read about today's financial markets, laying out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

On the macro front

The consumer price index, the jobless claims report, the Energy Information Administration natural gas report, the Energy Information Administration petroleum status report, the Treasury Budget report, the Fed balance sheet and the money supply report are due out today.

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