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Insurers Post $34.5 Billion in Investment Losses

Gavin Magor

Investment losses at life and health, and property and casualty insurers jumped to $34.5 billion in the third quarter, more than double the amount in the first half of the year, according to a review of the latest financial statements.

The $49.7 billion in losses for the first nine months of 2008 is a record for the industry. In the first half, losses totaled $15.3 billion.

Ten companies with the largest investment losses as of Sept. 30

The bottom 10 insurers include eight annuity providers, among them group companies from American International Group(AIG), Allianz(AZ), Massachusetts Mutual and TIAA.

AIG attributed $10 billion in losses to "market disruption" in the third quarter. Five of the 10 worst investment losses were posted by AIG insurance companies, with a total of $18.4 billion. Overall, AIG insurers lost $23.6 billion in investments on the way to a $19.6 billion net loss.

Some companies recorded investment gains. The top 10 insurers with the most profitable investments made $4.1 billion. Three of those were Fairfax Financial group insurance companies, which pulled in $908 million. Overall, Fairfax insurers made $976 million in investments and had net profit of $944 million.

Ten companies with the largest investment gains as of Sept. 30

Note: The insurers referred to in this article represent those filing the Life and Health or Property and Casualty annual statement blank with the National Association of Insurance Commissioners. Some companies may complete a different filing if they do not meet the NAIC requirements for mandatory Life and Health or Property and Casualty blank completion. Fourth-quarter data is not available as regulatory filings aren't required until next month.

TheStreet.com Ratings issues financial strength ratings for 4,000 life, health, annuity, and property/casualty insurers. They are available at no charge on the Insurers & HMOs Screener. In addition, the Financial Strength Ratings on each of the nation's 8,600 banks and savings and loans are available on the Banks & Thrifts Screener.