AXA having operations across most business lines will lead the company to mixed results following COVD-19. The firm has lower levels of exposure in travel and business interruption, which will help the insurer, but its high levels of life insurance leave it exposed to increased claims, according to GlobalData

GlobalData insurance analyst, Deblina Mitra, commented: “AXA’s general outlook has worsened as it has a strong presence in Europe (58% of premiums), which has been heavily affected by The company has a fairly diversified business, with operations across most business lines. However, the business is mostly concentrated on life insurance, which could face the pressure of slowdown.

“In 2018, over 28% of AXA’s premiums came from the non-life insurance business. Incremental sales in this segment are expected to be impacted, as various businesses enter a sluggish growth phase.”

AXA has declared that claims for business interruption are expected to be limited, due to non-inclusion of COVID-19 risk by reinsurers during renewal. There are legal cases ongoing involving a number of insurers in this area, and the outcomes will be critical for AXA, and the industry as a whole.

Mitra continues: “The good news for AXA is that its exposure to high-risk lines, such as travel and health insurance is very small. Travel insurance accounted for a negligible share in its total premium in 2018, so the restriction on domestic and international travel is not expected to have much impact on its revenue”.