Alleghany Underwriting is withdrawing from property reinsurance following its losses from the World Trade Centre's destruction.
The Lloyd's insurer was already suffering badly before the September 11 attacks and will now concentrate more on primary insurance and its aviation reinsurance business.
It expects pre-tax losses from the terrorist attacks to total about $112m (£70m). The loss estimate includes reinsurance recoveries and reinstatement premiums.
A company spokesman said: "It was already getting a lot of claims and the US property book was showing bad results and, like hundreds of other insurers, it was hit by the September 11 events."
The company's only involvement in property reinsurance will be "a little on a very selective basis".
Director of underwriting Rupert Atkin said the company's future reinsurance business would be limited mainly to aviation.