Cox increases WTC loss estimate

Cox Insurance today warned that its losses as a result of the September 11 terrorist attacks could be as high as stg £125m (€200m).

The new figure is nearly double the insurers’ initial estimate of its exposure to the disaster of stg£67m (€108m).

The group said claims from insurance and reinsurance cover it offered on buildings near the World Trade Centre had so far reached around stg£85m (€137m), and total pre-tax losses from the disaster could be as high as stg£125m (€200m).

Chief executive Michael Dawson said Cox, which accepted stg£750m (€1.2m) of premiums last year, would make a loss for 2001 as a result of the disaster.

But he added that increases in insurance premiums would help the business regain profitability and mitigate the loss.

Cox, which writes some business through the Lloyd’s of London insurance market, is also in the process of trying to claim back some of its losses from third parties.

The London-based group recently restructured its commercial insurance lines to reduce its exposure to unpredictable disasters such as earthquakes and hurricanes.

It has also expanded its motor insurance operations, which make up most of the business, through increased market share and the acquisition of Crowe Group’s motor insurance syndicate at the end of last year.

Mr Dawson said the group was continuing to keep its operations under review and was looking at a range of financing options to help it expand and develop.

Shares in the group plunged 14% following the announcement, losing 19p to 118.5p.