Argo Group International Holdings Ltd warned that it will book about $26 million in losses related to the Covid-19 pandemic in its first-quarter results.

The Bermudian-based re/insurer said some of the losses related to business interruption coverage and the cost of expected litigation.

The estimate refers to estimated losses incurred before March 31. Argo expects to incur “additional losses and claim related expenses in subsequent quarters depending on the timing and duration of impacts related to the Covid-19 pandemic,” the company said.

Argo’s investment results were also impacted by volatility in financial markets during the first three months of the year. For the first quarter, Argo said it expects to report pre-tax net realised and unrealised investment losses of $162 million, partially offset by net investment income of $35 million.

In explaining its pandemic-related exposures, Argo said it “expects to report pre-tax net catastrophe losses of $29 million, including approximately $26 million related to the Covid-19 pandemic, primarily resulting from contingency and property exposures in the company’s international operations and property exposures in its US operations.

“Property losses relate to sub-limited affirmative business interruption coverage, primarily in certain international markets, as well as expected costs associated with potential litigation.”

Kevin Rehnberg, Argo’s chief executive officer, said: “While this continuing event is significant, Argo remains financially strong and will continue to support our customers and producers through the challenges ahead.”