Transatlantic Holdings Inc. announced that its preliminary estimate of pre-tax cost, net of reinsurance, related to Hurricane Rita approximates $50 million, or $33 million on an after-tax basis for the full year of 2005.
In addition, TRH updated the previously reported impact, net of reinsurance, of Hurricane Katrina and other third quarter 2005 catastrophe loss events. Such pre-tax costs (which exclude the impact of Hurricane Rita) now approximate $345 million, or $224 million on an after-tax basis for the full year of 2005, including $300 million of pre-tax costs, or $195 million on an after-tax basis, related to Hurricane Katrina, with the majority of the balance related to European floods.
These estimated costs of third quarter catastrophe events, which are inclusive of marine and energy losses, also reflect the net cost of reinstatement premiums based on these loss estimates. In addition, these estimated costs include a significant amount of judgment and consider industry loss projections, output from catastrophe modeling software, market share analysis, and a review of certain large in-force contracts.
Due to the unprecedented nature of Hurricane Katrina, including the related legal and regulatory uncertainty, and the preliminary nature of the information used to prepare all these estimates, there remains material uncertainty at this time as to the ultimate costs that TRH will bear related to these third quarter catastrophe events.
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