HAMILTON, Bermuda (Bloomberg) ? PXRE Group Ltd., which reinsures property against catastrophes, forecast its net loss will widen by as much as $40 million because of Hurricane Rita damage.

PXRE?s third-quarter net loss will be as much as $320 million, and its 2005 net loss will be as much as $220 million, bigger than its prior full-year estimated loss of as much as $165 million, the company said in a statement.

On September 19, PXRE projected its 2005 net loss would almost double from $85 million because of increased costs related to Hurricane Katrina. The company said that storm would cost PXRE as much as $300 million, up from an estimate of as much as $235 million.

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

Chief Financial Officer John Modin didn?t immediately return a voice mail to his office after business hours. PXRE shares fell 69 cents, or 4.5 percent, to $14.81 in New York Stock Exchange composite trading yesterday, and are down 41 percent this year.

Catastrophe reinsurers share insurers? business, agreeing to pay claims on hurricanes, earthquakes and other disasters in exchange for premiums.