Cox: WTC loss could hit £125m

COX Insurance almost doubled its estimate for potential losses from the World Trade Centre disaster to £125m today. It also warned that it was looking at fresh funding options to bolster its finances.

Cox chief executive Michael Dawson said a rising number of property-related claims resulting from the 11 September attacks could push Cox's share of losses to between £75m and £125m.

Potentially that is triple the initial £42m estimate produced by Cox on 23 September, which was subsequently raised to £67m at the end of October.

Total industrywide losses from the disaster are thought to be between $40bn and $70bn (£28bn-£49bn).

Cox, currently valued at £179m, said it was considering 'a range of financing options' including a rights issue. Dawson declined to comment on whether the business was now effectively up for sale.

The insurer's shares fell 19p to 118 1/2p.

Cox said its latest estimate was based on a definition of the attack as a single event. Twin Towers leaseholder Larry Silverstein is seeking to have the attack defined as two separate disaster events, potentially doubling insurers' payout for both towers to $7.1bn.

Dawson warned that there was still 'considerable confusion' surrounding individual company exposures to the disaster and that an industrywide agreement was needed to stop legal wrangles over insurance liabilities and payments dragging on for years.