Silverstein case could add further £2.3bn

The cost to insurers of the 11 September attacks now stands at $40.2bn (£27bn), according to the latest estimates.

The calculation by the US Insurance Information Institute (III) comes days after another estimate, by US actuary the Insurance Service Office (ISO), showed a 22% increase from the loss predicted shortly after the attacks.

ISO took into account property damage and business interruption, but left out liabilities, workers‚ compensation, aviation and casualty losses and life and health cover.

It arrived at a figure of $20.3bn (£13.5bn), but warned that the total could rise further.

The III included all major classes of loss in its workings. III director Robert Hartwig said the total expected loss was beginning to stabilise, but still "bounced around by $1bn or $2bn a month".

Figures for workers' compensation and life cover losses have reduced as more information has become available. But figures for business interruption and property loss increased last week as more claims have been made and some existing claims have become more expensive.

The property loss could leap by $3.5bn (£2.3bn) if leaseholder Larry Silverstein wins his legal battle to claim for two losses.

Hartwig said the other category to contain a significant uncertainty was "other liability". This is a catch-all category that includes estimates for any legal action not falling into another category.

These could range from lawsuits that fall outside the bounds of US workers' compensation rules or allegations that the WTC towers were defective.

An ISO breakdown of claims from New York reveals that of 49,000 claims so far, 30,000 have been under personal lines, 15,000 have been commercial and 4,000 for motor.

Before 11 September, the costliest insured catastrophe in the US was 1992's Hurricane Andrew, which at today's prices caused an estimated $19.6bn (£13bn) of damage.

The ISO's Dave Dasgupta said some WTC claims may not emerge for years as damage to buildings is discovered or contamination issues become apparent.

In a separate development, a judge ruled that the court battle between Larry Silverstein and insurers will hear evidence about post-11 September conversations between Silverstein's lawyers and staff at Willis, the property magnate's broker. It had been argued that these conversations would be protected under privilege rules.

The move to compel Willis staff to testify was supported by insurers fighting to prove that the destruction of the WTC was one insured event. Silverstein argues that the hijackings and their consequences constitute two insured events.

Such a ruling could double the losses faced by lead insurer Swiss Re and other insurance companies.

Jacques E Dubois, chairman, chief executive and president of Swiss Re America Holding Corporation, said the decision would help show that Willis agreed with Swiss Re that the terrorist assault resulted in a single loss under policy terms governed by documents issued by Willis.