(Bloomberg) -- Allianz SE canceled a share buyback program that it had suspended earlier in the year as the hit from the Covid-19 pandemic continued to mount in the third quarter.

Virus-related hits rose to 1.3 billion euros ($1.5 billion) by the end of September, up from about 1.2 billion euros in the first six months of the year. Allianz said it won’t repurchase some 750 million euros of shares that were still left in a buyback program for 2020, “in light of the ongoing economic uncertainties.”

While the insurer doesn’t keep a ranking of loss events, the pandemic has already cost it more than the 470 million euros it reported for hurricane Katrina in 2005, the most expensive single loss event for the industry so far. Virus expenses are now approaching those of the 9/11 terror attacks that cost the company about 1.5 billion euros in 2001.

The pandemic is posing a major challenge for insurers, which have to contend with simultaneous claims across multiple industries and business lines. A single unit of Allianz, which says it’s the largest insurer of Hollywood studios, reserved hundreds of millions of dollars this year for coronavirus-related claims after movie and television studios were forced to curtail production during lockdown.

More losses might be on the way as the second wave of the pandemic is hitting Europe, though the experience of the first lockdowns will help insurers limit losses. Chief Financial Officer Giulio Terzariol said in an interview on Friday that claims from new lockdowns will be contained after Allianz stopped covering pandemic-related losses in most new property-casualty insurance contracts.

“The claims we expect to see from these lockdowns are going to be significantly lower,” Terzariol said on Bloomberg TV. “We might see some impact,” but it won’t be comparable to the hit from the first wave, he said.

Allianz rose 1% at 9:03 a.m. in Frankfurt trading, as profit for the third quarter came in higher than expected and its asset management unit reported inflows. The stock is down 23% this year, broadly in line with the industry.

Key figures from Allianz’s earnings:

  • 3Q operating profit EU2.91 billion, estimate EU2.65 billion (range EU2.50 billion to EU2.76 billion) (Bloomberg Consensus)
  • 3Q net income EU2.06 billion, estimate EU1.63 billion (range EU1.49 billion to EU1.79 billion)
  • 3Q property & casualty combined ratio 94.5%, estimate 95.8%
  • 3Q revenue EU31.4 billion
  • 3Q property & casualty operating profit EU1.32 billion, estimate EU1.14 billion
  • 3Q Life & Health operating profit EU1.12 billion, estimate EU1.03 billion
  • 3Q Asset Management operating profit EU677 million, estimate EU668.3 million

AXA SA said earlier this week its best estimate for pandemic-related costs for the year remained at around 1.5 billion euros. The Paris-based insurerer booked the charge three months ago, warning at the time that the number could go higher if conditions worsened. Zurich Insurance is scheduled to report earnings next week.

There is “exceptional uncertainty” about what the ultimate claims burden from the pandemic will be, Swiss Re said in an industry report in July. Some estimates put losses at $100 billion or above, according to insurance think-tank Geneva Association. Hurricane Katrina, the costliest single insured disaster to date, stands at about $80 billion.

Allianz got some relief in April when Germany agreed to backstop losses of 30 billion euros for commercial credit insurers this year amid the pandemic. Its Euler Hermes unit is among the biggest players in this market. The deal came at a steep price as insurers had to surrender 65% of their premiums to the government. There are discussion between Germany and the industry on possibly extending the backstop beyond December.

Allianz is also counting on its asset management businesses as a source of stability and diversification. Its bond giant Pacific Investment Management Co. saw third-party net inflows of 27 billion euros in the third quarter, while its smaller sister unit Allianz Global Investors lost 1.5 billion euros that outside clients pulled.

In April, Allianz withdrew its 2020 earnings forecast citing economic uncertainty caused by the pandemic. It paid a dividend for 2019 despite European Union regulators calling on insurers to preserve capital.

S&P Global Ratings affirmed Allianz’s ratings last month, saying it expects the company to maintain a “very strong capitalization”, despite the pandemic’s effects, “thanks to its diversified and overall robust earnings streams”.

(Updates with CFO comment in sixth paragrap, shares in seventh.)

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