RSA's £200m to cover atrocities

ROYAL & SunAlliance has made a £200m provision in its nine-month results against claims generated by the World Trade Centre attacks which chief executive Bob Mendelsohn said involves 'the largest loss the insurance industry has ever sustained'.

It will be years before the full financial cost of the 11 September attacks can be known, but Mendelsohn thinks the £200m estimate is 'robust'. RSA stressed that almost all of its WTC loss was as a primary insurer rather than as reinsurer and that 'virtually all' of the group's expected gross WTC loss, put at £750m, is well covered by solid reinsurers.

RSA group operating profit tumbled more than a third to £321m, the stock market downturn contributing to a £59m drop in life insurance profits to £118m, while £800m came in from closures and disposals.

The shares today put on 5p to 387p as finance director Julian Hance said the insurer would benefit from stronger post-11 September commercial property insurance premiums, terms and conditions.