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<\/div>\nThe deadly fire that ripped through seven high-rise towers in Hong Kong is expected to result in a surge in near-term claims among insurers, and hit earnings of the complex\u2019s main underwriter, an affiliate of China Taiping Insurance Holdings 0966.HK<\/span>, an analyst at Fitch Ratings said on Thursday.<\/p>\n China Taiping Insurance (Hong Kong) has coverage exposure of more than $200 million to the Wang Fuk Court apartment complex, and to the contractor of renovation work, publicly available owners\u2019 meeting minutes and a project-briefing document showed.<\/p>\n The city\u2019s deadliest fire in decades<\/a> killed at least 159 people.<\/p>\n China Taiping Insurance (Hong Kong) is expected to be hit by a \u201ctemporary uptick\u201d in its combined ratio, Fitch credit ratings agency analyst Mengyuan Wang said in a note. The ratio is a key performance gauge for property and casualty insurance underwriting profitability.<\/p>\n Read more:<\/strong> Taiping Insurance Shares Hit by Over $200 Million Exposure to Hong Kong Fire<\/a><\/p>\n It is also expected to see \u201cmodest capital erosion,\u201d it added, but that\u2019s unlikely to affect Taiping\u2019s credit rating, Mengyuan said.<\/p>\n A spokesperson for the Chinese insurance group declined to comment when contacted by Reuters.<\/p>\n The insurer told Reuters on Tuesday it completed the first batch of nine home insurance claims from Wang Fuk Court residents, paying a total of HK$5.37 million ($689,983) in compensation.<\/p>\n Reinsurance and potential support from the Chinese government should mitigate the impact, Mengyuan added.<\/p>\n However, the rating agency warned, with loss development still unfolding, higher-than-expected third-party liability claims and slower recoveries could heighten earnings volatility.<\/p>\n By Thursday\u2019s market close, Hong Kong-listed shares of state-owned China Taiping Insurance had dropped 4.2% since the outbreak of the fire.<\/p>\n Rising Premiums and Higher Expenses<\/strong><\/p>\n The tragedy is likely to tighten market conditions across the board, according to Fitch, with insurers raising premiums, deductibles and exclusions for high\u2011rise renovations and higher\u2011risk locations.<\/p>\n Some may also reduce or withdraw underwriting capacity, it added.<\/p>\n The industry is also likely to face tighter reinsurance pricing and stricter coverage limits, which could lift operating expenses for primary insurers through 2026 to 2027, Mengyuan added.<\/p>\n ($1 = 7.7828 Hong Kong dollars)<\/p>\n (Reporting by Selena Li; editing by Emelia Sithole-Matarise)<\/p>\n Photograph: Firefighters try to extinguish a flames engulfing a building after a fire broke out at Wang Fuk Court, a residential estate in the Tai Po district of Hong Kong\u2019s New Territories, Wednesday, Nov. 26 2025. (AP Photo\/Chan Long Hei)<\/em><\/p>\n Related:<\/strong><\/p>\n<\/p><\/div>\n Topics<\/span> Profit Loss<\/a> <\/p>\n<\/p><\/div>\n Was this article valuable?<\/p>\n<\/p><\/div>\n
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