XL Capital, ACE Ltd. announce third-quarter losses

XL Capital Ltd. and ACE Limited both announced taking financial hits as a result of a particularly fierce hurricane season in 2005.
XL Capital (NYSE:XL) announced its third-quarter net losses from catastrophes amount to $1.47 billion, ensuring a net loss by the Bermuda-based property/casualty insurer for the year. The figure includes pre-tax losses, net of reinsurance, of $1.16 billion from Hurricane Katrina and $263.6 million from Hurricane Rita.
Pre-tax net losses from other third-quarter natural catastrophes will total an estimated $89.7 million, according to XL.
The company’s third-quarter operating income would have been “broadly in line” with equity analysts’ estimates, excluding the catastrophe losses, Brian O’Hara, XL’s president and CEO says. But now XL expects to report an operating loss for the year.
Meanwhile, ACE Limited (NYSE: ACE) is reporting a net loss for the third quarter of $112 million, compared with net income of $4 million for the same quarter last year. ACE Ltd. says its losses from hurricanes Katrina, Rita and Dennis and other catastrophes resulted in an after-tax charge of $742 million for the quarter. This compares to the after-tax net catastrophe losses of $406 million in the third quarter of 2004.
ACE Ltd. announced its third-quarter combined ratio was 116.5%. “If catastrophe losses were excluded, the combined ratio would be 86.4%, a 0.6 point improvement over the comparable quarter in 2004,” the company announced.