Markel (MKL) Estimates Losses From Recent Hurricanes; Comments on Losses From Lehman and WaMu

October 9, 2008 4:41 PM EDT

Markel Corporation (NYSE: MKL) reported that it estimates net losses, including reinstatement premiums, from Hurricanes Gustav and Ike will range from $100 million to $125 million on a pre-tax basis, which will add approximately 5 to 6 points to the Company's annual combined ratio.

For the quarter ended September 30, 2008, the Company also reported estimated realized investment losses of $116 million, of which approximately $75 million related to sales of fixed maturities issued by Lehman Brothers Holdings, Inc. and Washington Mutual (NYSE: WM). The remainder of the losses related primarily to write downs for other-than-temporary declines in fair value of various fixed maturities and preferred equity holdings in Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE.

Net unrealized investment gains, net of taxes, at September 30, 2008 are estimated to have decreased to $110 million from $158 million at June 30, 2008.

For the third quarter of 2008, the Company's realized investment losses and pre-tax decrease in net unrealized investment gains are estimated to total $190 million, which represents less than 3% of the Company's $7.5 billion of invested assets at June 30, 2008.[SM]

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