Bermuda reinsurer Validus Holdings Ltd. last night posted a net loss of $118.4 million driven by catastrophe losses of more than $300 million.

Validus said the net impact of three major events was $306.9 million. It attributed a net loss of $293.1 million to the Chilean earthquake, $12.6 million related to European windstorm Xynthia and $18.2 million related to the Melbourne hailstorm.

The company's net loss in the first three months of the year broke down to 95 cents per diluted share, compared with net income of $94.9 million, or $1.20 per share, for the same period last year.

"Our results were affected by the elevated level of catastrophe activity during the quarter, principally the Chilean earthquake which stands among the most costly industry losses in history outside of the United States," said Ed Noonan, chairman and chief executive officer of Validus.

The company made a net operating loss of $136.4 million, or $1.09 per share, compared with net operating income of $100.4 million, or $1.27 per share, for the same period in 2009.

Combined ratio — which reflects the proportion of premium dollars spent on claims and expenses — was 134.3 percent, reflecting an underwriting loss.

Validus saw a huge increase in the amount of insurance and reinsurance it sold, reflecting the acquisition of IPC Holdings Ltd. in the second half of last year.

Gross premiums written for the first quarter were $870.9 million, representing a 42.8 percent increase on last year's total of $609.9 million.

Net investment income improved 28.1 percent for the first quarter, totalling $34.3 million, compared to $26.8 million for the prior-year period. Validus attributed the increase to higher average investment balances slightly offset by reduced market yields.

Net unrealised gains on investments for the quarter were $15.4 million compared to $22.2 million last year. These gains resulted primarily from improved market conditions for fixed-income securities.

As at March 31, 2010, shareholders' equity was $3.76 billion. Diluted book value per share was $28.66, compared to $29.68 at year-end 2009.

Total capitalisation at March 31, 2010 was $4.3 billion, including $289.8 million of junior subordinated deferrable debentures and $246.8 million of senior notes.