Best’s News & Research Service - November 30, 2001 10:34 AM (EST)
Copenhagen Re Shuts Down, Citing Sept. 11 Aftermath
COPENHAGEN, Denmark //BestWire// - Denmark's Copenhagen Reinsurance Co. Ltd. became the first European reinsurer to be driven out of business by the fallout from the Sept. 11 terrorist attacks on the United States.
Copenhagen Re will make provisions of about 700 million Danish kroner ($1 = 8.33 kroner) to cover its share of the Sept. 11 losses, according to its parent, Alm. Brand A/S, which said the reinsurance claims would push the group to a loss of about 800 million kroner for 2001.
The company cited the unavailability of retrocessional coverage in its decision not to write any new business for 2002. Alm. Brand said it would reorganize its operations and focus on its core activities of nonlife, life and pension insurance and banking.
Copenhagen Re's estimate of losses related to the World Trade Center disaster remains subject to change, with more specific figures likely to be released in 2002, Alm. Brand said.
The reinsurer had net premium income of 2.35 billion kroner in 2000 and posted an after-tax loss of 75 million kroner.
A.M. Best Co. lowered Copenhagen Re's rating to B (Fair) from B++ (Very Good) on Nov. 21 and kept the rating under review with negative implications (BestWire, Nov. 21, 2001).
(By Brendan Noonan, international editor: noonanb@ambest.com)