The good times may be over for insurers and reinsurers if the second quarter of this year is any indication. Record US catastrophe losses in the three months to June 30 are eating into the industry's profits.

Bermuda-based LaSalle Re Holdings Ltd. is the latest company to be hurt by high levels of claims in the quarter. LaSalle's net income was down 52 percent to $18.2 million in the third quarter of its financial year ended June 30, compared to the same period 1997.

The company wrote gross premiums of $26.8 million, down $2.7 million from last year. LaSalle earned net premiums of $42.1 million, down $3.8 million.

Investment income was $8.7 million, compared with $8.5 million in third quarter last year.

LaSalle losses and loss expenses increased $19.1 million to $23.8 million, or 56.1 percent of net premiums earned, compared to the same quarter last year.

"Overall, our results are in line with our expectations given the current market conditions,'' LaSalle chairman, president and chief executive officer Victor Blake stated in a press release. "Our losses reflect the significant number of worldwide weather events that occurred in the quarter.'' The property and casualty industry was hit with estimated record reported losses in the US of about $3.6 billion in the quarter ended June 30. Floods in the UK and other events around the world combined to drive estimated worldwide losses up to about $5 billion.

Last year during the same period insured catastrophe losses were $980 million.

Until this year, the highest second quarter catastrophe-loss total was $3.37 billion in 1992.

The most expensive catastrophe in the quarter was $650 million incurred in three days of severe windstorms, hail and tornadoes in 12 states from May 30 to June 1.

Last week IPC Holdings also said its profits had been affected by the high level of claims. IPC had net income of $22.2 million for the quarter, about $3.3 million less than last year due to a higher level of claims.

LaSalle's nine month income before minority interest, including net realised gains and losses on investments, was $69.9 million, down $28.5 from the same period last year.

Gross premiums written were $131 million compared with $144.1 million. Loses and loss expenses for the nine months was $52.2 million compared to $22.2 million during the same period ended last year.