Moody's Rating Service expects the wildfires consuming Texas will have a negative impact on insurer's third quarter results when combined with other losses experienced during the third quarter. The firm reported that even if the losses were three times more than the 1,600 homes Texas officials say are confirmed lost to fires, the losses are "small compared with the U.S. P&C industry's earnings capacity and capital base."
Earlier in Sept., the Insurance Council of Texas said it expected losses from the wildfires to exceed $100 million, which does put it close to (but not technically among) the top ten catastrophic U.S. wildfires.
"The Texas wildfires will not be a major capital or credit event for the P&C industry," Moody's said. "However, losses from the wildfires will pressure 2011 earnings, which have already weakened by high winter—spring storm and tornado losses during the first half of the year and Hurricane Irene in the third quarter."
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