British insurer Beazley swung to a loss for the first half on Thursday after setting aside $170 million for coronavirus-related claims, saying the fallout from the crisis would be similar to a major natural catastrophe.

The Lloyd’s of London insurer benefited from higher premium rates last year after a string of catastrophe claims led to hefty bills in 2018. But it had flagged the $170 million to cover pandemic claims in April.

Chief Executive Andrew Horton told Reuters the funds set aside could edge higher if lockdowns extended into December.

“In responding to this crisis, the insurance industry faces record losses on par with major natural catastrophes,” Beazley said.

Its combined ratio, a key measure of profitability, inched up to 107% from 100%, but the firm maintained an annual target of 100%. A level below 100% indicates an underwriting profit.

“We find it reassuring that the COVID-19 loss estimate did not change as the group just raised capital and the initial loss estimate was somewhat large relative to peers,” KBW analysts wrote.

Shares were 3.4% higher at 445.5 pence by 0735 GMT.

Horton said Beazley was reducing its exposure to employment practices liability insurance, which provides cover to employers against claims of discrimination or wrongful termination.

“We do believe there will be an uptick in employers laying off people in the second half of the year. We have historically seen a resulting increase in employment practices claims during recessions,” Horton said.

Beazley, which provides casualty and property, cyber and political risk insurance, abandoned its interim dividend as it posted a loss before tax of $13.8 million for the six months ended June 30, compared with a profit of $166.4 million in the same period a year earlier.

Net investment income slumped to $83.2 million from $170.3 million from a year earlier, reflecting the pandemic-driven market selloff.