Hanover subsidiary takes loss amid global catastrophes

Sam Bonacci The Hanover Insurance Group is headquartered in Worcester.

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By Sam Bonacci

Worcester-based Hanover Insurance Group announced Thursday its specialist insurance business Chaucer segment will see losses in the second quarter as a result of large loss activity and the weakening of the British pound sterling.

The Chaucer is an insurance group that underwrites risks at Lloyd’s of London, which is a worldwide specialist insurance market for businesses. The Chaucer is ranked among the top 25 casualty insurers in the United States. However, catastrophic events both domestically and abroad have prompted The Hanover to estimate a second quarter combined ratio in the range of 103 to 105 percent, with anything above 100 representing a loss. This represents a higher number than initially estimated, but is within the company’s underwriting appetite and experience, said Eugene M. Bullis, chief financial officer at Hanover.

This loss is the result of events both domestically and abroad, according to a release from Hanover. The most notable catastrophe and large loss events impacting Chaucer's results in the quarter include the Alberta wildfires and the Ecuador and Japan earthquakes, according to the company, as well the Jubilee Oil Field turret malfunction and the Brussels Airport terrorist attack losses, which occurred in the first quarter. The weakening of the pound sterling following Great Britain's vote to exit the European Union also negatively impacted the combined ratio.