Australia's general insurers fared well during the financial crisis, and continue to benefit from the government's guarantees and stimulus programs, according to ratings agency Moody's Investors Service. Insurers are benefiting from economic stimulus programs because higher property values have led to higher premiums and government spending on infrastructure bolsters the commercial sector, Moody's said in its "Australian Property & Casualty Insurance Industry Outlook." If natural catastrophe losses do not exceed planned allowances, Australian p/c insurers may reap higher insurance profits from rate increases and improving investment environment, said Moody's, which maintains a stable outlook for Australia's p/c insurance industry. But growth in 2010 may be subdued, given the unevenness in the recoveries of the global and local economies, said Wing Chew, Moody's Vice-President and author of the report. "Cost and productivity will remain major concerns, while consolidation will continue, as the industry tries to secure productivity gains and cost efficiencies," he said.

Hamilton, Bermuda-based Aspen Insurance Holdings Ltd says that recent catastrophe losses may cost it $110m. The insurer estimates its losses from last month's Chilean earthquake - which could cost the industry an estimated $5bn to $8bn - at between $70m to $110m. The earthquake loss is derived from Aspen's international reinsurance operations with the company's insurance business accounting for less than $0.5m. The insurer's loss estimate for Windstorm Xynthia is less than $5m, with its reinsurance operations accounting for the entire loss. Aspen says that it expects its exposure to the recent hailstorms and floods in Australia to be negligible.

US -based broking group Arthur J Gallagher has agreed to acquire UK broker FirstCity Partnership as part of an expansion drive. The acquisition is for an undisclosed sum and is expected to close in April. The FirstCity team of brokers, led by Tim Watkins, will operate as Gallagher UK's financial and professional lines division, while the rest of the FirstCity operations will be merged into existing Gallagher UK divisions. David Ross, chief executive of Arthur J Gallagher (UK) Ltd (AJG UK), told newswire Reuters that the acquisition would bring in a further £20m in brokerage and expects a substantial increase in top and bottom lines on the back of the transaction. AJG UK has recently expanded into the energy insurance, corporate client risk management and the managing general agent markets. The broker is looking to build on its existing lines of business through further acquisitions and expansion in 2010, said Mr Ross. "In the energy space, Oslo is of interest and for our emerging business and property cases, we will look to Singapore and China," he said. In a separate announcement, former AJG UK deputy chief executive officer Dominic Hagger has joined London-based broker RFIB Group as operations director.

US p/c group Chubb Corp expects Q1 earnings to be reduced by $290m, or $189m after tax, owing to losses from catastrophes around the world. The New Jersey-based group said Monday that around $200m of the losses are tied to US disasters, including $125m from the winter storm in northeastern states earlier this month. The $90m in losses from catastrophes outside the US includes $70m from the Chilean earthquake. All figures are net of reinsurance recoverables and reinsurance reinstatement premiums.