The Chubb Corp. said catastrophe losses for the third quarter would amount to approximately $400 million and it would suffer more than $100 million in investment losses.
In a statement, the Warren, N.J.-based insurer said yesterday catastrophe losses for the third quarter of 2008, principally related to Hurricane Ike, would be approximately $400 million before tax (72-cents per share after taxes). The figure includes Chubb's estimated share of an assessment from the Texas Windstorm Insurance Association.
Chubb said it estimates that its net realized investment losses, including impairments, will be approximately $115 million before tax (20-cents per share after taxes) for the third quarter of 2008.
The company estimates net unrealized investment losses for third-quarter 2008 will be approximately $540 million before taxes. The unrealized investment losses are due to the widening of credit spreads and the decline in the equity markets, Chubb said.
As of Sept. 30, under its securities lending program, outstanding loans of securities owned by Chubb totaled approximately $150 million, with the related collateral invested in a short-term money market fund. Chubb said it is no longer loaning securities under this program and expects that the remaining securities currently on loan will be returned by early December.
The company also estimates its net income per share for the third quarter of 2008 to be in the range of 70-cents to 74-cents. Operating income per share is estimated to be in the range of 90-cents to 94-cents for the third quarter of 2008. Operating income is defined by the company as net income excluding after-tax realized investment gains and losses.
For the third quarter last year, the company reported operating income per share of $1.68 and net income of $1.87 per share.
Chubb said it plans to report third quarter 2008 results as scheduled after the market close on Oct. 23.
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