Hurricane losses hammer 3Q results

Transatlantic Holdings Inc., XL Capital Ltd., ACE Ltd. and Arch Capital Group Ltd. have all announced taking financial hits as a result of a particularly fierce hurricane season in 2005.

Transatlantic Holdings, Inc. (NYSE: TRH) reported a $144-million net loss for the third quarter of 2005, compared to a net loss of $21.8 million over the same quarter last year.

Transatlantic’s third quarter 2005 results include the aggregate estimated pre-tax impact of significant catastrophe loss events amounting to $395 million – or $256 million on an after-tax basis. Such pre-tax costs for the third quarter include approximately $300 million related to Hurricane Katrina and approximately $50 million related to Hurricane Rita.

XL Capital (NYSE:XL) says its third quarter net losses from catastrophes amount to $1.47 billion, ensuring a net loss by the Bermuda-based property/casualty insurer for the year. The figure includes pre-tax losses, net of reinsurance, of $1.16 billion from Hurricane Katrina and $263.6 million from Hurricane Rita.

Pre-tax net losses from other third-quarter natural catastrophes will total an estimated $89.7 million, according to XL.

Meanwhile, ACE Limited (NYSE: ACE) reported a net loss for the third quarter of $112 million, compared with net income of $4 million for the same quarter last year. ACE Ltd. says its losses from hurricanes Katrina, Rita and Dennis and other catastrophes resulted in an after-tax charge of $742 million for the quarter. This compares to the after-tax net catastrophe losses of $406 million in the third quarter of 2004.

ACE Ltd. announced its third-quarter combined ratio was 116.5%. “If catastrophe losses were excluded, the combined ratio would be 86.4%, a 0.6 point improvement over the comparable quarter in 2004,” the company announced.

Arch Capital Group Ltd. (NASDAQ: ACGL) predicted its third quarter earnings would be negatively impacted by the losses related to recent catastrophes.

The Bermuda-based company announced its losses from Hurricane Katrina will likely be $173 million, while Hurricane Rita are expected to amount to $48 million. Although less severe, the combined losses of $18 million from Hurricanes Dennis and Emily as well as the $13 million loss from the European floods are expected to influence the Company’s negative outlook.