Bermuda-based insurer XL Capital expects to post a net loss of about $60m (£43m) in the fourth quarter, after charges for additions to its reserves as well as other losses.
The insurer said it was boosting reserves at its North American casualty reinsurance book because of adverse developments from underwriting done before its acquisition of NAC Re.
XL's bottom line was also damaged by Enron, the crash of American Airlines flight 587 and several large European property losses in the fourth quarter.
It said its expected net loss included realized investment losses and mark-to-market losses on credit enhancement transactions. Fourth quarter operating results are expected to be at or near break-even
XL is expected to post fourth-quarter earnings of nil to $1.27 per share, with a mean estimate of 85 cents per share, compared with $1.13 per share in the fourth quarter of 2000, according to market research firm Thomson Financial/First Call.
