Last checked at 17 Oct 2008 07:00
CATLIN ESTIMATES FINANCIAL IMPACT OF HURRICANES,
PROVIDES UPDATE ON INVESTMENTS AND OUTLOOK
HAMILTON, Bermuda - Catlin Group Limited ('CGL': London Stock Exchange), the international specialty property/casualty insurer and reinsurer, today announces its initial estimate of the financial impact of Hurricanes Ike and Gustav and provides an update on its investment performance and trading conditions.
The Group's losses arising from Hurricanes Ike and Gustav are estimated at approximately US$200 million, net of reinsurance protections and reinstatement premiums. The Group's estimate is based on the assumption that market-wide insured losses from Hurricane Ike will amount to approximately US$15 billion.
The Group's total net investment return for the nine-month period ended 30 September 2008 was -0.9 per cent. This return was calculated after valuing all investments on a mark-to-market basis. This includes an unrealised loss of US$118 million on fixed income investments as at 30 September. The Group held US$11 million of Lehman Brothers debt, which has been written down to US$1 million. The Group's investment, insurance and reinsurance exposures relating to American International Group Inc. are not material.
The Group's cash and investments at 30 September 2008 amounted to approximately US$6.2 billion (30 June 2008: US$6.2 billion). Asset allocation has not materially changed since 30 June, and the Group remains defensively positioned. At 30 September, cash and investments comprised approximately 40 per cent cash, 20 per cent government and government agency securities, 27 per cent other fixed income securities, 11 per cent hedge funds/funds of funds, and 2 per cent equities.
Current capital levels are sufficient to support the embedded growth arising from the acquisition of Wellington Underwriting plc, including the expiration at the end of 2008 of the quota share reinsurance provided to the Catlin Syndicate by former Wellington third-party capital providers. Current capital levels are also sufficient to support expected increases in premiums arising from improved insurance and reinsurance market conditions in 2009.
Stephen Catlin, chief executive of Catlin Group Limited, said:
"The unprecedented events of this year, including the instability in international financial markets, have presented the Group with both challenges and opportunities. We believe that these are market turning events. We expect an improved rating environment created by the removal of significant capital from the marketplace.
"Catlin's balance sheet remains strong. Our investment in the business over the past few years leaves us well positioned to take advantage of the new opportunities."
Catlin will issue its third-quarter interim management statement on Thursday 13 November 2008.
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For more information contact:
| Media Relations: | ||
| James Burcke, | Tel: | +44 (0)20 7458 5710 |
| Head of Communications, London | Mobile: | +44 (0)7958 767 738 |
| E-mail: | james.burcke@catlin.com | |
| Liz Morley, Maitland | Tel: | +44 (0)20 7379 5151 |
| E-mail: | emorley@maitland.co.uk | |
| Investor Relations: | ||
| William Spurgin, | Tel: | +44 (0)20 7458 5726 |
| Head of Investor Relations, London | Mobile: | +44 (0)7710 314 365 |
| E-mail: | william.spurgin@catlin.com |
Notes to editors:
| 1. | Catlin Group Limited, headquartered in Bermuda, is an international specialist property/casualty insurer and reinsurer writing more than 30 classes of business worldwide through four underwriting platforms and an international network of offices. Gross premiums written in 2007 exceeded US$3.3 billion. Catlin shares are traded on the London Stock Exchange (ticker symbol: CGL). More information about Catlin can be found at www.catlin.com. |
| 2. | Catlin's four underwriting platforms are: |
| The Catlin Syndicate at Lloyd's of London (Syndicate 2003), which is a recognised leader of numerous classes of specialty insurance and reinsurance. The Catlin Syndicate is the largest at Lloyd's in 2008 based on premium capacity of £1.25 billion | |
| Catlin Bermuda (Catlin Insurance Company Ltd.), which is a leading participant in the Bermuda market, underwriting a diversified portfolio of property treaty, casualty treaty, political risk and terrorism, and structured risk coverages. | |
| Catlin UK (Catlin Insurance Company (UK) Ltd.), which specialises in underwriting commercial non-life insurance for UK clients through a network of regional offices. In addition, Catlin UK underwrites other classes of commercial business which are also written by the Catlin Syndicate. | |
| Catlin US, which encompasses Catlin's operations based in the United States. Catlin US underwrites a wide variety of specialty property/casualty insurance and reinsurance products from a network of offices throughout the U.S. Catlin US includes Catlin Insurance Company Inc. and Catlin Specialty Insurance Company Inc. | |
| 3. | Catlin's international network of offices allows the Group to diversify further its risk portfolio and to work more closely with local policyholders and brokers. Besides its offices in the UK, US and Bermuda, Catlin operates offices in Canada (Toronto and Calgary), Australia, Singapore, Malaysia, Hong Kong, China, Guernsey, Germany, Belgium, France, Spain, Italy, Switzerland, Austria and Brazil. |