UPDATE 2-Reinsurers' shares fall after New Zealand quake

* Second quake since September kills dozens

* Shares down in Australia as well

* Eqecat says losses to exceed $1 bln

* S&P upgrades XL on valuation after declines (Adds analyst comment, updates shares)

By Ben Berkowitz

NEW YORK, Feb 22 (Reuters) - The shares of Bermudan reinsurers fell sharply on Tuesday as another devastating earthquake struck New Zealand, months after a less-severe quake whose effects were still being counted by the industry.

The magnitude 6.3 quake in the country's second-largest city, Christchurch, killed at least 65 people. The toll is expected to rise markedly. [ID:nL3E7DM1YX]

It was considered to be an aftershock of last September's earthquake, which was the second-costliest disaster in the world in 2010, based on insured losses.

Munich Re has estimated that quake cost insurers at least $3.3 billion, although the figure was as of last October. Reinsurers around the world have raised their loss forecasts since then, in some cases substantially.

While the September quake was stronger, it struck early in the morning. The latest happened at midday when people were at work and streets were busy, which could magnify the ultimate losses.

Risk modeling company Eqecat said on Tuesday the new quake will probably exceed $1 billion in damages, based on current indications. It cautioned, however, that determining losses from the new quake will be complicated by the damage left from the last one.

ACE Ltd (ACE.N) shares were down 1.25 percent, XL Group Plc (XL.N) was down 3.7 percent, PartnerRe Ltd (PRE.N) fell 4.1 percent and Everest Re Group Ltd (RE.N) was down 2.7 percent in late afternoon trading. The broader S&P insurance index .GSPINSC was down 2.2 percent.

S&P equity analysts upgraded XL to "buy" from "hold" on the sharp decline, noting the stock was now trading at a sharp book value discount to peers.

The shares of Australian insurers fell more than 2 percent in Tuesday trading as well.

The quake is not expected to hurt their earnings, but is expected to force Australian insurers to purchase more reinsurance. [ID:nL3E7DM05C] (Reporting by Ben Berkowitz; editing by Maureen Bavdek, Andre Grenon and Matthew Lewis)