October 2008/1

Credit derivatives – famously described as “financial weapons of mass destruction” by Warren Buffett – came back to bite his Berkshire Hathaway investment conglomerate as its profits slumped 77 percent in the third quarter.

Fallen insurance giant American International Group has unveiled a staggering $24.47bn third quarter net loss on the day it announced a $150bn revamped bail-out package with the US government it says is a “dramatic step forward for AIG and all of its stak

American International Group (AIG) and the US government are close to an agreement that would see the current $123bn bail-out of the troubled insurer replaced with a new $150bn programme that includes the buying up of toxic assets, according to reports.

Lloyd's (re)insurer Hiscox echoed a number of its peers in signaling a hardening (re)insurance market in its interim management statement; predicting a "greatly improved outlook" for 2009.

Shares in Munich Re traded up this morning after the reinsurer booked a EUR260mn consolidated profit for the third quarter – albeit 77 percent down on the prior-year period – as catastrophe losses and a 66 percent fall in investment income took their toll

Michael Bannon, assistant vice president of AIG's London aviation insurance division, has become the latest in a growing number of senior figures to leave their posts at the troubled insurance giant, The Insurance Insider understands.

Reinsurance broker Guy Carpenter has seen Q3 underlying revenue fall 10 percent year on year as reinsurance premiums continued to fall, while sister company, global broker Marsh, managed to grow underlying earnings 1 percent during the period.

Hannover Re has become the latest (re)insurer to slip to a third quarter net loss under the weight of heavy catastrophe claims and investment write-downs.

Global directors' and officers' liability (D&O) and errors and omissions (E&O) losses resulting from the credit crisis could hit $12.1bn, according to a report released today (5 November).

Swiss Re has become the latest reinsurer to slump to a third quarter deficit, as it booked a SFr304mn net loss for the period, driven by a SFr614mn operating loss in its life and health business.

Flagstone Reinsurance Holdings Limited has revealed a Q3 2008 net loss of $186.5mn, compared to net income of $66.2mn for the same quarter a year earlier as investment and catastrophe losses weighed heavily.

Independent reinsurance broker RK Carvill is separating its underwriting and broking businesses in a corporate restructure that will result in “material” redundancies, The Insurance Insider can reveal.

Ironshire Insurance Ltd president and chief underwriting officer Les Rock has resigned from the Bermudian insurer for “personal reasons”.

Shares in Hartford Financial Services Group have slumped more than 35 percent in early trading today after the US insurer booked a $2.6bn Q3 loss, lowered its full-year forecasts, and failed to reassure analysts over its capital position.

RenaissanceRe slumped to a $231mn net loss for the third quarter as it was hit by the double impact of net realized investment losses and hurricanes Gustav and Ike.

Lloyd’s (re)insurer Advent Capital Holdings plc is on course to end the year in the black after a volatile first three quarters that have seen it just about break even for the year to 30 September 2008.

Newly Swiss-domiciled (re)insurer ACE Ltd has avoided the third quarter net losses posted by a number of its peers, but nevertheless saw its net income decimated by net realised investment losses and catastrophes as it plummeted 92 percent to $54mn.

Zurich Financial Services Group (ZFS) has joined a growing chorus of (re)insurers to reveal preliminary hurricane loss estimates, with expected claims payments from hurricanes Gustav and Ike amounting to $600mn before tax.

Modeling firm Risk Management Solutions (RMS) has almost doubled its initial estimate for industry losses from Hurricane Ike to a range of $13bn to $21bn – making it the third most expensive US hurricane in history.

Willis Group shares were trading down heavily after the broking giant reported third quarter profits below analysts’ expectations and said it was reviewing profit targets for 2009 and 2010 because of the financial turmoil.

Up-for-sale Transatlantic Holdings Inc has become the latest (re)insurer to post a net loss for the third quarter as the combination of financial market turmoil and catastrophe losses weighs heavy on the sector.

Securities law firm Klayman & Toskes has filed a class action against a list of prominent investment banks alleging that they failed to identify “misstatements and omissions” in an American International Group prospectus for a debt issue they were underwr

Lloyd’s insurer Amlin plc has revealed its star head of underwriting Tony Holt will stand down from executive responsibilities at the end of year, taking a non-exec board position.

Bermudian (re)insurer Platinum Underwriters Holdings Ltd reported a Q3 net loss of $45.3mn, compared to $91.3mn for the same point in 2007.

A $115mn settlement in the litigation brought by New Orleans Teachers' Retirement System against four former AIG chief executives and CV Starr & co has been preliminarily approved by Delaware Chancery Court.

Fitch Ratings has put XL Capital on Rating Watch Negative on concerns over the (re)insurer’s capital position following its announcement of heavy investment losses.

Bermudian (re)insurer Platinum Underwriters Holdings Ltd reported a Q3 net loss of $45.3mn, compared to $91.3mn for the same point in 2007.

Former Independent Insurance executive Keith Rutter has left (re)insurance broker Lockton International for US insurer AmTrust.

US (re)insurer Travelers’ net income for the third quarter plummeted to $214mn compared to $1.198bn in the same period last year.

US (re)insurer Travelers’ net income for the third quarter plummeted to $214mn compared to $1,198bn in the same period last year. Overall, underwriting losses were $208mn for the quarter compared to an underwriting profit of $520mn in the previous year.

The New York insurance authorities are considering the innovative approach of putting the liquidation of Midland Insurance Company out to tender in a bid to improve the returns available to policyholders.

Hannover Re has issued a profits warning as it said would be unable to meet its full-year targets as a result of the double impact of financial markets turmoil and heavy catastrophe losses.

Lloyd’s expects its members to face net claims of £1.3bn, or $2.34bn, from hurricanes Gustav and Ike, based on an aggregate $20-25bn industry loss.

Flagstone Reinsurance Holdings Ltd has ended its search for a Lloyd’s platform with an agreement to buy Marlborough Underwriting Agency Ltd from Berkshire Hathaway, as it becomes the eighth Bermudian to establish a Lime Street presence since the start of

AM Best has downgraded Bermuda-based insurer XL Life reinsurance’s financial strength rating from A to A-, citing declining premium and capitalisation pressure as its parent, XL Capital Ltd has been winding down its business profile...

Shares in specialty (re)insurer Catlin Group Limited, were under pressure in London this morning as it unveiled Q3 estimates for mark to market investment declines and losses from Hurricane Ike and Gustav totalling 11 percent of shareholders’ Q2 equity.