Gloomy forecasts questioning the ability of reinsurers to meet claims arising from the September 11 attacks were on Tuesday criticised by Standard & Poor's, the rating agency.

It said the terrorist acts would increase demand for insurance products in general and boost pricing, and these forces would in time enable re-insurers to replenish the capital they lost in 2001.

The agency said the powerhouses of global re-insurance - Swiss Re, General & Cologne Re, Munich Re, and Employers Re - formed the backbone of a financially sound insurance response to the World Trade Center attack.

These four triple-A-rated groups generated almost half of global reinsurance premiums in 2000, and have estimated their collective losses at more than $5bn.

S&P factored into its re-insurance outlook a significant upward revision to the loss estimates it has so far received.

The agency said there remained a large discrepancy between estimates for the insurance industry as a whole, which in some cases exceeded $70bn for property/casualty payouts, and the sum of loss exposures reported by individual companies, which currently amounted to $20bn.