NEW YORK (Reuters) — Four reinsurers, flush from a year without catastrophic storms and with higher premiums, are set to test investor enthusiasm with a series of US stock listings.Bermuda-based reinsurer Validus Holdings Ltd. and Greenlight Capital Re Ltd., a Cayman Islands-based specialty property and casualty reinsurer, filed for initial public offerings with the US Securities and Exchange Commission last Tuesday.

The pair are joined by Bermuda-based reinsurers CastlePoint Holdings Ltd. and Flagstone Reinsurance Holdings Ltd. which each filed for IPOs last year.

The companies, many backed by hedge funds or private equity investors, are racing to capitalise on a record year in profits for the industry and an expected rise in reinsurance rates — the prices insurers pay for their own insurance, analysts said.

“When these companies were formed, we felt the exit strategy for the initial investors was likely an IPO,” said Mark Rouck, an analyst with Fitch Ratings. “But it has happened quicker than we thought.”

The companies are racing to the public market before investors grow weary of offerings from insurance companies, and before a major disaster dampens the industry’s financial outlook, Rouck said.

Two companies have gone public so far this year, raising $281 million, compared with three deals that raised $906 million during the same period in 2006, according to data-tracker Dealogic.

The new crop of reinsurer IPOs are part of the cycle for the industry.

The last group, formed after the September 11, 2001 attacks, which caused about $50 billion in insurance claims, had successful IPOs, at least initially.

Private equity investors poured billions into a series of reinsurance companies, including AXIS Capital, a Bermuda insurer formed by broker Marsh & McLennan Cos. Inc., and Allied World Assurance Co. Ltd., formed with investments by American International Group Inc., Chubb Insurance Cos., and Goldman Sachs Group Inc.

Axis shares hit the market in 2003, raising $473 million, and rose 18 percent to $26 its first day. Shares closed on Friday at $32.50. The company trades at about six times its 2006 earnings, according to Reuters Estimates.

Other reinsurers also posted IPO gains, but hurricanes in 2005 caused more than $68 billion in insured losses.

Reinsurers paid out more than $20 billion in claims, forcing some companies out of business.

But those exits presented an opportunity for investors in a new group of reinsurers.

Reinsurance costs are expected to climb in storm-prone coastal areas of the United States in 2007 with a dearth of companies able to meet the demand for premiums, experts told Reuters in December.

Bermuda-based Allied World, formed in 2001, went public in July at $34 and rose as much as 30 percent to $44.28. Shares closed on Friday at $43.40.

The company trades at 5.6 times its 2006 earnings, according to Reuters Estimates.

The rise in Allied World shares coincides with the rebound of the Dow Jones US reinsurance index, which climbed 23 percent to record highs in December after a tumble in May, prior to the hurricane season.

The reinsurers face competition that tends to favour those with a longer track record of paying claims after a catastrophe and absorbing losses, said Justin Fuller, an analyst with Morningstar Inc.

“The smaller companies that are coming out are competing for the scraps of the insurance business,” Fuller said.

Greenlight, backed by hedge fund Greenlight Capital Inc., is seeking to raise as much as $175 million in Class A ordinary stock.

Validus, founded by private equity firm Aquiline Capital Partners LLC, filed to raise up to $200 million.

Flagstone is seeking $175 million in its IPO. Affiliates of Lehman Brothers Holdings Inc., part of the underwriting team, are Flagstone’s top shareholders.

CastlePoint, sponsored by New York specialty property and casualty insurance company Tower Group Inc., is seeking $50 million.

The companies have not released terms for the deals.