Alterra Japan Estimate: $60 to $100 Million

April 13, 2011

investments-alterraAlterra Capital Holdings Limited today [Apr.13] announced that its initial loss estimate from the March 11, 2011 Tohoku earthquake and tsunami in Japan is in the range of $60 million to $100 million, pretax and net of reinsurance and reinstatement premiums.

This estimate, which is based on an estimated event insured loss of $20 billion to $35 billion, equates to 2.1% to 3.4% of Alterra’s 2011 opening shareholders’ equity, and is within Alterra’s normal risk tolerances for natural catastrophe events in this region.

Additionally, Alterra owns a catastrophe bond with exposure to Japanese earthquake and tsunami losses. Depending on ultimate insured loss levels from Japanese events, this bond could generate an investment loss to Alterra of up to $25 million.

W. Marston (Marty) Becker, Alterra’s President and Chief Executive Officer, commented: “We continue to be saddened by the extent of damage and suffering that the Japanese earthquake and tsunami have caused. At a magnitude of 9.0, the earthquake was one of the largest ever recorded. Loss estimates are still immature, and we are concerned that the final industry loss may be larger than many of the existing estimates. Accordingly, our estimate of losses to Alterra reflects a wide range of potential industry outcomes.”

Alterra estimates that its losses from other first quarter 2011 catastrophe events continue to be within previously announced ranges. The total of Alterra’s losses associated with all first quarter 2011 catastrophe events is expected to be less than 5% of Alterra’s 2011 opening shareholders’ equity.

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