Swiss Re estimates that claims could costs of $1.2bn, net of retrocession and before tax, from the earthquake and the tsunami in Japan.

The reinsurer said that while these preliminary estimates are subject to revision to a higher than usual degree of uncertainty, as the event continues to unfold.

It added that the current estimates are driven primarily by modeled estimates for its portfolio. Calibrating this to ceding clients’ estimates, and to original policyholder losses, will take an extended period of time.

The Zurich-based reinsurer expects that the determining precise claims information will take several months and the high proportion of commercial and industry claims concerned would extend the evaluation process.

Swiss Re CEO Stefan Lippe said that the company is committed to using its expertise and experience to support clients in Japan as they manage the risks related to such devastating events.

Swiss reinsurer further added that the government-run insurance scheme provides cover for earthquake shock and tsunami for residential properties insured by non-life companies, which is not reinsured in the international reinsurance market.

Last week, Chartis, a P&C unit of American International Group (AIG), estimated a pre-tax insurance loss of $700m from the Japan earthquake, out of its total estimation of $1bn in its first quarter of 2011.