Fitch Ratings anticipated that the explosion at the Port of Beirut on August 4, 2020 will exacerbate the pressure on the earnings of European reinsurers from the COVID-19 pandemic. However, it did not expect the blast to significantly affect the credit profiles of European reinsurers. It said that initial estimates from the local insurance industry suggest that insured losses in Lebanon could reach about $3bn, which are comparable to the losses from the explosion at the Chinese Port of Tianjin in 2015. It expected Lebanese insurers to undertake most of the primary insurance coverage, and for European reinsurers to share a large part of the losses. But it noted that claims from the Beirut Port explosion would have a limited impact on the reinsurers' capital positions, given that such claims are much smaller than the pandemic-related insurance claims.
 
The agency did not expect the insured losses from the Port of Beirut explosion to exceed the losses from the Tianjin incident, given the low insurance coverage in Beirut and the type of property and goods that were damaged. It said that the insurance industry estimated that only about 30% of the economic losses from the explosion at the Port of Beirut were likely insured, and that the mix of the damaged property and goods has lower value than the destroyed property in Tianjin. It pointed out that Hannover Re reported net claims of €111m, while Munich Re and Swiss Re reported claims of €175m and of $250m, respectively, following the explosion at the Port of Tianjin. It anticipated that claims of this magnitude from the blast at the Port of Beirut would moderately exacerbate pressure on the 2020 earnings of the reinsurers. It noted that European reinsurers have yet to disclose their estimated losses from the explosion at the Port of Beirut.
 
In parallel, Fitch considered that it is uncertain to what extent the European reinsurers will be liable for the losses. It said that, if the investigation of the Lebanese authorities concludes that the explosion was accidental, most insurance contracts will likely be honored, but it noted that there would be limits to the payouts. It also expected claimants without insurance policies to seek compensation from the parties they deem responsible for the explosion, and that the latter may then seek compensation from their own insurers. It noted that it is unclear whether the Lebanese government will bear some of the responsibility and costs.