Catlin profit disappoints as Sandy loss widens
February 8, 2013 8:14 PM EST
Bermuda-based insurer Catlin
Catlin, operator of the biggest syndicate at Lloyd's of London
The shortfall reflected a widening of Catlin's projected Sandy loss to $225 million, from an initial estimate of $200 million published in December.
The insurer also said that the grounding of the Costa Concordia cruise liner off the Italian coast in January last year would cost it $51 million, up from previous guidance of $35 million.
Catlin shares were down 2.2 percent by 0847 GMT, the second-biggest faller in the mid-cap FTSE 250 <.FTMC> index, which was 0.3 percent higher.
"We expect the upgrade to Sandy loss estimates and a more surprising 45 percent increase on Costa Concordia will raise some questions," Espirito Santo analyst Joy Ferneyhough wrote in a note to clients.
Catlin's 2012 profit was still up almost fivefold from the $71 million it made in 2011, with natural disaster-related payouts falling to $225 million from $678 million.
Last year was a relatively quiet one for natural disasters, the biggest of which was Sandy, a 1,000-mile wide storm that struck the north east of the United States in October and is expected to cost the insurance industry up to $25 billion.
Insurers paid out a total of $65 billion in catastrophe claims last year, according to reinsurer Swiss Re
Catlin blamed the bigger Costa Concordia loss on an Italian government order that the vessel be removed whole to limit potential pollution, a more costly process than cutting it up.
The insurer is paying a 2012 dividend of 29.5 pence per share, an increase of 5.4 percent.
(Reporting by Myles Neligan; Editing by Tom Bill and David Goodman)
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