Swiss Re ups WTC loss estimate and predicts loss for 2001

Swiss Re, the world’s second-largest reinsurer has increased its after-tax loss estimate from the September 11 terrorist attacks to US$1.73 billion from US$1.25 billion. This and other exposures have left the company predicting a loss of more than US$117 million.Other loss events adding to the difficult year include Tropical Storm Allison and the Enron collapse. As well, deterioration of investment earnings were a factor in 2001’s results.The increased September 11 loss estimate is the result of a 9.9% increase in gross loss estimates, reductions in recovery assumptions and foreign exchange rate fluctuations, the company says. Reserves of about US$600 million have been set aside in 2001 to absorb September 11 losses.The company is optimistic, however, given rate increases seen in the current renewal season. Overall increases topped 15%, with treaty renewals at about 11% and facultative renewals an impressive 35%.Despite the loss prediction, the company is standing by its dividend of US$1.47 per share.