NU Online News Service, Oct. 26, 12:53 p.m. EST
Hurricane Irene is primarily to blame for $34.6 million in pretax catastrophe losses during the third quarter for HCC Insurance Holdings Inc., and the insurer also expects a pretax net increase to loss reserves of $27.5 million.
HCC says pretax earnings for the third quarter will be about $83 million.
The storm impacted HCC's property insurance and property treaty lines of business in its international segment.
So far this year, estimated catastrophe losses stand at $107.9 million, pretax.
Houston-based HCC says its diversified financial products line of business in the professional liability segment primarily caused adverse 2011 accident year results—a loss of $28.2 million—leading to the strengthening of reserves.
The diversified financial products lines include coverage for private equity, hedge funds and investment managers. The line has been “adversely impacted by continued depressed economic conditions and unfavorable litigation-expense trends,” says John N. Molbeck Jr., chief executive of the international specialty insurance group, in a statement.
The company's actions to improve include re-underwriting the entire book of business, he adds.
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