Storms Rain on Centris Group Profits

Centris Group Inc., an insurance holding company, said storms cut second-quarter earnings by $1.3 million before taxes, the company’s worst quarter of catastrophe losses since the 1994 Northridge earthquake.

Severe wind, hail and tornadoes in the Midwestern and Southeastern U.S. will cut the Costa Mesa-based company’s earnings per share by about 7 cents. The losses were concentrated in the company’s reinsurance business.

Reinsurers help primary insurance companies spread risk, essentially by assuming insurance policies in exchange for a share of the premiums.

Centris is the latest insurance company to see claims jump as storms swept across the U.S. in the last three months. Bad weather caused $3.4 billion of damage to insured property in the second quarter, according to Insurance Services Office Inc., which tracks losses.

Centris said it had no catastrophe losses in the year-earlier quarter. So far in the first half, its catastrophe losses have totaled $1.6 million, or 9 cents a share, compared with no losses during 1997’s first half.

The 1994 Northridge earthquake, which cost the insurance industry $12.5 billion, knocked $2.1 million off Centris’ first-quarter 1994 earnings.