State Auto, RenRe Report Hurricane Losses

The latest tally of insurer third-quarter hurricane losses saw RenaissanceRe Holdings Ltd. report a net negative impact of $275 million today and State Auto Financial Corporation putting its loss between $55 million and $60 million.

RenaissanceRe defined "net negative impact" as "the sum of estimates of net claims and claim expenses incurred, earned reinstatement premiums assumed and ceded, lost profit commissions and minority interest."

The company said most of the estimated losses are attributable to Hurricane Ike, but the figure also includes losses from Hurricane Gustav.

Columbus, Ohio-based STFC, which describes itself as "a super-regional p-c insurance holding company," said its pre-tax hurricane loss estimate of between $55 million and $60 million compares to third-quarter 2007 pre-tax storm losses of $5.6 million. Over the last five years, STFC said, pre-tax catastrophe losses have averaged $11.8 million.

STFC said its worst losses from Ike resulted from tropical storm-force winds in Ohio, Indiana and Kentucky.

The two companies also released information on their exposure to financial services companies linked to the ongoing credit crisis.

RenaissanceRe said it has current direct holdings of fixed maturity securities issued by Lehman Brothers Holdings Inc. and its subsidiaries of $8.7 million (par amount) within its fixed maturity investment portfolio.

The company added that it has insignificant direct holdings of fixed maturity securities issued by American International Group Inc. and its subsidiaries, and Washington Mutual Inc. and its subsidiaries, and has insignificant reinsurance recoverables and premiums receivable from AIG.

RenaissanceRe said it has no direct exposure to preferred or common shares issued by Lehman Brothers, AIG, Washington Mutual, Fannie Mae, or Freddie Mac.

STFC said it had no direct exposure to Lehman Brothers Holdings Inc. or its subsidiaries, no direct exposure to American International Group Inc., and no exposure to the common or preferred shares of Freddie Mac or Fannie Mae.

"STFC's exposure to Freddie Mac and Fannie Mae is limited to senior debt issues and mortgage-backed pools, which amount to less than 4 percent of invested assets, with no impairments anticipated as a result," STFC said.