Catlin Reports Over $500M in Cat Losses

NU Online News Service, Aug. 8, 2:54 p.m. EDT

Specialty insurer and reinsurer Catlin says it suffered more than $500 million in catastrophe losses in the first half of the year, and its chief executive says he expects more with the onset of the Atlantic hurricane season.

“The insurance industry's performance for the full year depends largely on Atlantic windstorm and other catastrophe activity during the second half,” says Stephen Catlin, CEO of Catlin, in a statement. “There have been virtually no insured losses arising from Atlantic windstorms for the past two years, and various forecasters predict a severe Atlantic windstorm season in 2011. It is rare to incur no substantial insured Atlantic windstorm losses for three consecutive years.”

The Hamilton, Bermuda-based carrier reported last week that it experienced $534 million in catastrophe losses for the first six months of this year. The losses were net of reinsurance and reinstatement premiums. This compares to catastrophe losses last year of $135 million for the same period.

The result contributed to a combined ratio of 117 compared to 98 for the first half of last year.

The company reports a net loss to common shareholders for the first six months of $220 million compared to net income of $57 million for the same period last year. Net premium earned rose from $1.6 billion in 2010 to $1.8 billion this year, as revenues grew 14 percent, or $236 million, to $1.9 billion.

Despite concerns with the oncoming hurricane season, Catlin says he is confident that the company is in a strong position to withstand additional losses.

The company also reports that Sir Graham Hearne will retire as chairman in May 2012 and will be succeeded by John Barton as an independent non-executive director.