Olympus Re, a Bermuda property-catastrophe reinsurer, was hit by at least $457.2 million in third-quarter losses from hurricanes Katrina and Rita, its largest customer said in a regulatory filing.

White Mountains, which is also a Bermuda-based insurance and reinsurance company, said in a quarterly filing with the US Securities and Exchange Commission, that Olympus owed it a total of $705.6 million from reinsurance claims. At the end of 2004, Olympus ? a privately-held company that has not issued its own public estimate of storm claims ? was capitalised with about $650 million.

Olympus? biggest customers are Folkamerica Reinsurance and Sirius, both White Mountains reinsurance units.

While the amount Olympus owes White Mountains in reinsurance payments, called a ?reinsurance recoverables? balance in industry parlance, covers more than the third quarter period, $457.2 million was related to third-quarter hurricane activity, White Mountains said.

White Mountains? reinsurance units buy reinsurance from Olympus to help spread the risk in policies sold to insurance clients. That makes Olympus a retrocessional reinsurer, or a reinsurer of reinsurers.

The extent of Olympus? losses from Hurricane Katrina prompted A.M. Best, one of the leading rating firms for the insurance sector and the only company that rates Olympus, to downgrade the company in mid-September.

Under the action, Olympus? financial strength rating of A- (Excellent) was dropped to B+ (very good), and its issuer credit rating was downgraded to ?bbb -? from ?a -?.

White Mountains? reinsurance units buy significant retrocessional reinsurance from Olympus through various quota-share agreements between the two companies that date back to Olympus? formation in 2002.

Olympus sources most if not all its business from White Mountains, according to financial reports filed by Olympus in 2002, 2003 and 2004.

No financial information has been released by the company in 2005.

White Mountains indicated in its filing that Imagine Re, which is also a privately-held Bermuda reinsurer, owes it a total of $221.6 million in reinsurance recoverables.

It did not break out what portion of that, if any, was related to the third-quarter. Imagine previously issued a statement saying it estimated $17 million in exposure to Hurricane Katrina.

Bermuda companies have posted third quarter losses in the region of $8 billion, largely because of heavy Atlantic storm activity this year. Hurricane Katrina, the devastating August 29 storm that hit the Gulf Coast region, is expected to hit insurers with a bill as high as $60 billion, after widespread damage. And the industry loss could rise to $80 billion after later hurricanes Rita, and in the fourth quarter, Wilma, caused billions of dollars in estimated damage.

White Mountains said the amount owing from Olympus and Imagine was fully collateralised through funds held, a trust and by offsetting balances payable.

Olympus? B+ rating from A.M. Best, a measure of its credit worthiness, remains on negative watch, or subject to a further downgrade.