NU Online News Service, Sept. 18, 2:00 p.m. – Standard & Poor’s, New York, says it will likely put on CreditWatch with negative implications the ratings on insurers and reinsurers with claims related to the Sept 11 terror attacks on the World Trade Center. The rating agency puts aggregate insured losses at $14 billion based confidential as well as public information it has acquired from 55 leading insurers and reinsurers. This figure is likely to rise significantly once better estimates become available.
While many of these companies have substantial financial flexibility and capital strength and are expected to have their ratings affirmed, notes S&P. However, given some initial estimates of loss the rating agency believes a significant number of these companies are not as well positioned to absorb these exposures and are likely to receive ratings downgrades.
In an initial comment late last week, S&P said that once losses exceed $15 billion, it would expect to see a significant impact on balance sheets of individual insurers.