XL Group Ltd has estimated net catastrophe losses of $1.48 billion for the third quarter.

Most of the losses — about $1.33 billion — were attributed to hurricanes Harvey, Irma and Maria.

The announcement comes after the Association of Bermuda Insurers and Reinsurers said Bermuda entities were likely to pay out at least $25 billion in hurricane-related claims, about a quarter of the insured losses from the three storms.

Mike McGavick, XL’s CEO, said the hurricanes had shown up the “systemic failure” of underinsurance and its devastating impact on the less well-off.

And he added that the catastrophes should lead to “more realistic and sustainable pricing” in the insurance and reinsurance markets.

XL, which is based in Bermuda, said its preliminary estimates were pre-tax and net of reinsurance, reinstatement and adjustment premiums and redeemable non-controlling interest.

On an after-tax basis, the preliminary estimate of total catastrophe net losses

comes to $1.35 billion.

The estimates are based on a combination of catastrophe modelling, exposure analysis and preliminary ground-up notifications and are consistent with private insured market loss estimates for hurricanes Harvey, Irma and Maria in the range of $75 billion to $90 billion.

The three storms contributed approximately 25 per cent, 40 per cent and 25 per cent, respectively, to the company loss estimates, with 10 per cent related to all other events in the quarter, most notably the Mexican earthquakes and Typhoon Hato.

The estimated losses are approximately evenly split between XL’s insurance and reinsurance segments.

The company said that after the “meaningful reinsurance recoveries” this quarter, the company continues to have significant catastrophe reinsurance protections remaining for 2017 and 2018, including catastrophe bond protections, some of which extend through 2019.

Mr McGavick said: “Our hearts break at the havoc caused by these events; the terrible pain and anguish suffered. We are proud of our people, some of whom have had their own losses to deal with, who are working tirelessly with our partners to help our clients in these difficult times.

“And, as ever, the problem of underinsurance is again laid bare, afflicting especially those already less well off. It is appalling, and all of us with expertise to offer must bend our minds to solving these systemic failures.

“In terms of the effects on XL itself, given the specific nature of the events themselves our estimated losses are largely in line with our expectations, and our capital strength and talented teams ensure that we remain positioned to continue solving the risk needs of clients and brokers.

“As for market conditions, risk awareness has changed due to these events, and this in turn should cause the market to move towards more realistic and sustainable pricing for the risks undertaken.”

Given the complexities of losses from these events, XL said there was “considerable uncertainty” over the preliminary estimates.

XL shares fell 0.8 per cent in regular trading to close on $39.35. In after-hours trading, after the loss announcement came out, XL shares were up 3.2 per cent to $40.60, as of 5.52pm Bermuda time.