NEW YORK (Bloomberg) ? Bermuda-based PXRE Group Ltd., which reinsures properties against catastrophes, said its 2005 net loss may be as high as $165 million, almost double an earlier estimate, because of Hurricane Katrina claims. The company?s shares had their biggest decline in four years.

PXRE forecast a net loss of $85 million to $165 million on Katrina costs of $235 million to $300 million, according to a statement yesterday. Earlier the Bermuda-based reinsurer predicted no more than an $85 million loss on a $235 million in Katrina costs.

Chief executive Jeffrey Radke said Katrina will spur ?substantial increases? in prices for catastrophe reinsurance throughout the industry. Rates surged after Hurricane Andrew in 1992 and the terrorist attacks in 2001, and the increases will be ?at least as pronounced? for Katrina, he said in the statement.

PXRE based its estimate on $30 billion to $40 billion in Katrina claims industrywide. Storm modeler Risk Management Solutions Inc. expects $40 billion to $60 billion, as much as triple the cost of Andrew.

Shares of PXRE fell $2.03, or 10 percent, to $17.80 in New York Stock Exchange composite trading, the biggest one-day drop since September 2001. The stock is down 29 percent this year.

Fitch Ratings last night affirmed the ?A? insurer financial strength ratings of Max Re Ltd. and its Dublin-based subsidiaries. Fitch also affirmed the ?BBB? long-term issuer rating of Max Re Capital Ltd., the Bermuda-based holding company of Max Re Ltd. said said the outlook was stable.

?The ratings reflect Max Re?s disciplined and flexible approach to underwriting risks, limited investment portfolio downside risk, and favourable parent company financial flexibility? Fitch said. ?Partially offsetting these positives is the execution risk derived from Max Re?s shift in product strategy and an overall higher investment risk strategy compared with the industry and its peers.?

Fitch said it had taken into account Max Re?s estimated losses of $60 million to $90 million from Hurricane Katrina, which it said was within Fitch?s expectations for a single event loss exposure relative to capital. Max Re had shareholders? equity of $1.025 billion at June 30, 2005, a 27 percent increase from year-end 2003.

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