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To: RockyBalboa who wrote (17592)	3/10/2003 11:04:11 PM
From: Mad2	Read Replies (2) \| Respond to of 18998

Doesn't sound comforting mad2 Copyright 2003 Associated Newspapers Ltd. DAILY MAIL (London) March 11, 2003 LENGTH: 171 words BODY: SWISS ROLL AT least UK insurers are better off than their Continental cousins. Shares in Swiss Life slumped 20pc last night. Its likely 2002 loss of GBP 800m has caused fears for its solvency. Dutch insurer Aegon is also under fire. Both should survive. But Andrew Ritchie, at broker Fox-Pitt Kelton, says: 'Low interest rates and falling equities are creating a perfect storm for insurers.' RSA, once over GBP 8, is now at 581Z2p. There are even greater worries about reinsurers, such as Germany's Gerling Re. Reinsurers take on risk for insurance companies, so any problems could quickly spread. Continental banks have pressing worries, too. Rating agency Fitch says German banks have taken on GBP 7bn of credit derivatives - which US investor Warren Buffett calls 'weapons of mass destruction'. The pain is spreading to London, where Germany's WestLB is set to axe jobs this week. In the US, old fears about home lending giants Fannie Mae and Freddie Mac, which have huge debts, are bubbling up again. LOAD-DATE: March 10, 2003 Copyright 2003 Associated Newspapers Ltd. DAILY MAIL (London) March 11, 2003 LENGTH: 269 words HEADLINE: BUFFETT WARNING SENDS SHUDDER THROUGH INSURERS BODY: BILLIONAIRE investor Buffett last night warned that a large unnamed reinsurer has 'all but ceased paying claims'. trouble in the industry could lead to billions of pounds of write-offs by insurers. comments by the legendary Buffett sent a shudder through the financial world. His Hathaway vehicle is the world's third largest reinsurer. Analysts speculated that Gerling Global Re, a subsidiary of troubled German insurer Gerling, is facing problems. If any large reinsurer stops settling claims it would have a domino effect. Insurers and banks, including leading British players, are heavy buyers of reinsurance contracts to lay off some of their risks. They be exposed to large Several reinsurers have stopped underwriting after massive September losses. 11 claims. Gerling said 'We are paying all claims that fall due.' Gerling Global Re was the world's seventh biggest reinsurer in 2001 when it made a GBP 400m loss. It stopped underwriting new business six months ago. Parent Gerling tried to sell the business, but regulators blocked the sale last month, partly over fears that claims would not be paid. Andrew Crockett, head of the Bank for International Settlements, has warned that the collapse of a major insurer could have a catastrophic effect on world financial systems. He is worried about links between banks and insurers through credit derivatives - a form of insurance against debt defaults. Credit rating agency Fitch said yesterday that German banks are making heavy use of credit derivatives to boost revenue. The GBP 1.25 trillion market is largely unregulated. LOAD-DATE: March 10, 2003