Lancashire: $65 to $125 Million in Chile Claims

Bermuda based Lancashire Holdings Limited today announced that it estimates its net losses before tax from the earthquake in Chile and subsequent aftershocks range from approximately US$65 to $125 million including the sum of gross claims and claims expenses, reinsurance recoveries and reinstatement premiums.

Lancashire has exposure to risks in Chile in the following classes: property retrocession, property direct and facultative, property catastrophe, marine and onshore energy. As additional information emerges Lancashire’s actual ultimate net loss from the Chile earthquake may vary materially from this preliminary estimate.

2010 Earthquake/Storm Estimates Given by Bermuda Based Reinsurers to date exceed 1.5 billion:

• Everest Re Group Ltd said it expects losses of approximately $225 million related to the Chilean earthquake.
• PartnerRe expect to receive claims of $220-$320 million after the severe damage caused by earthquake in Chile
• Platinum announced an initial loss estimate of $85 million from first quarter 2010 catastrophe events.
• Validus provided an initial estimate of losses from the earthquake and windstorm of $170 to $270 million.
• Flagstone said its estimated losses from claims related to the recent earthquake in Chile will be $50 million
• Max Capital projects claims of $10 – $20 million
• Axis expects claims of $60 – $120 million from the quake, and $10 – $20 million from storm
• Montpelier Re expects losses of $75 – $100 million from the earthquake
• Hiscox Ltd estimate a combined net loss of approximately $151 million
• XL Capital said estimated first quarter claims could top $200 million
• Ace Limited expect a loss of $125 million, $75 million from Chile alone
• Allied World expect a loss of $55 to $75 million dollars
• Argo Holdings project a loss of $25 to $35 million
• Arch Capital expect claims of $35 to $55 million
• RenaissanceRe said the impact on its financial results “will be significant and could be material”.

Collapsed highway in Santiago, Chile.

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Lancashire does not believe it has any material exposure to losses caused by European windstorm Xynthia, or to losses from any other major catastrophe events that have occurred so far in the first quarter of 2010.

Lancashire expects to recommence its previously announced share repurchase programme, in accordance with its stated intention of managing capital to enhance shareholder return.

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