Another Bermuda cat reinsurer, IPC Holdings, Ltd., has reported profit declines as a result of hurricane losses.

The parent of IPC Re Ltd. saw net income drop nearly 56.5 percent to $11.1 million for the quarter ended September 30 (1997: $25.5 million).

For the first nine months of the year, net income was $62 million, down 21 percent from $78.6 million in the prior year.

President and CEO John Dowling commented: "Following on from a highly active second quarter in respect of claims, the three months ended September 30, 1998 saw a continuation of that level of activity.

"In the third quarter of 1998, there were more claims from catastrophic events in the US than all previous third quarters since such records have been kept.

"The largest event in terms of insured loss damage was Hurricane Georges, which at current estimates of $2.6 billion (industry loss), ranks in the top five most costly Atlantic windstorms.

"IPC has incurred claims from this storm, since it is for such events that IPC provides reinsurance protection, and our loss provision for Georges is $9 million.

"In addition, we have incurred claims from a cyclone in India, new claims and additional claim development from the mid-West storms that took place in the latter part of the second quarter, some development of the Canadian January ice storm losses, the failure of two satellites and further marine loss activity.

"Given this level of claims frequency, we have incurred almost $19 million of losses in the third quarter.

"As we have commented previously, this level of volatility should not be surprising, in view of the type of reinsurance protection we provide. We remain focused and disciplined in our underwriting, which we believe has reduced the impact of these severe events on the company's results, as can be seen from the fact that in spite of all this activity, our combined ratio was 88.7% in the quarter, and 59.7% for the nine months.'' Premiums written in the quarter were $15.7 million, compared to $21.7 million written in the same quarter in 1997. Premiums written for the nine months were $106.2 million, down from $111.3 million written during the first three quarters of 1997.

Written premiums, the company said, were down because of rate reductions, rate of exchange differences and programme restructuring, which more than offset some new business and reinstatement premiums arising from increased claims activity.

Premiums earned in the third quarter were $29.4 million (1997: $28.6 million).

Premiums earned for the nine months ended were $89.6 million, compared to $84.3 million for the first nine months of 1997.

Net investment income was $7.7 million in the third quarter of 1998, compared to $7.1 million in the third quarter of 1997. For the nine months investment income was $22.4 million compared to $22.7 million in the corresponding period of 1997.

Losses incurred were $18.9 million in the three months, bringing the total for the nine months to $33.4 million, or 37.2% of earned premiums. This compares to $8.0 million, or 9.5% of earned premiums, for the first nine months in 1997.

Total assets at September 30 were $651.8 million, an increase of 11.4% over total assets at December 31, 1997. Total shareholders' equity was $559.3 million, compared to $528.3 million at December 31, 1997.