Chubb and American National reported loss estimates from the recent hurricanes totaling more than $650 million, while Quanta said it would discontinue writing new business in storm-hit areas.
Warren, N.J.-based Chubb Corp. said it estimates total losses in the third quarter will amount to $600 million pretax, primarily as the result of Hurricane Katrina.
After-tax loss for Chubb will come in at $390 million, the company said. The estimate includes loss expenses, estimated losses, and loss expenses net of reinsurance recoverable, reinsurance reinstatement premiums, and the company's share of losses from its minority interest in Allied World Assurance Co., Ltd. Allied is a Bermuda-based insurance and reinsurance company.
Galveston, Texas-based American National Insurance Company said its subsidiaries, American National Property and Casualty and ANPAC Louisiana Insurance Company and their subsidiaries, issued a revised estimate pretax loss, net of reinsurance, from Hurricane Katrina at $42 million. Estimated pretax loss before reinsurance is $222 million. The company's loss estimate on Sept. 2 was $17 million.
For Hurricane Rita, American National estimated pretax loss, net of reinsurance, is $10.4 million. Pretax loss before reinsurance was placed at $25 million.
Quanta Capital Holdings, Ltd., based in Hamilton, Bermuda, responded yesterday to A.M. Best's placement of the company under review with negative implications, by saying it is disappointed in the rating service's action.
Tobey J. Russ, Quanta chief executive officer, said Best's action is consistent with the rating firm's view of the industry in the aftermath of Katrina.
Mr. Russ said the frequency and severity of the windstorm events over the past two years has caused his company grave concerns about its prospects for profitability in its technical risk property and property reinsurance lines of business.
He added that Quanta will be conducting an internal review of the business and the catastrophe models it uses. In the meantime, it would discontinue the writing of new business in those areas.
Quanta also is developing a capital raising plan, he added.
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