Everest Re Reports 89% Drop In Quarterly Income

NU Online News Service, Oct. 19, 3:10 p.m. EDT?The St. Michael, Barbados-based reinsurer Everest Re Group Ltd.reported its third-quarter net profit has fallen by 88.6 percent,hurt by hurricanes that devastated parts of the southeastern UnitedStates as well as typhoons in Asia.[@@]

The reinsurer's third-quarter net income?which includes realizedcapitalized gains and losses, dropped to $11.5 million?downsignificantly from $100.3 million in profit reported during thecorresponding period one year ago.

Stephen Limauro, chief financial officer at Everest Re,acknowledged during this morning's earnings conference call thathis company has suffered substantial adverse impact from thisyear's hurricane season. "The catastrophe events of the thirdquarter, as we previously announced, had significant impact for thequarter, $190 million net of tax," Mr. Limauro said. Nonetheless,Mr. Limauro added, "we believe these are strong results in thecontext of our and the industry's catastrophe experience."

"Our results excluding hurricanes?combined with still-solid andvery-possibly stabilizing market conditions?indicate that theoutlook for the remainder of 2004 and 2005 remains quite positive,"Mr. Limauro told conference-call participants.

For the quarter, Everest Re saw its gross premiums written fallslightly, to $1.22 billion?a 1.8 percent drop from $1.24 billionposted one year ago?while net premiums written came in at $1.18billion, down 0.3 percent compared to the same period lastyear.

Everest Re's combined ratio rose to 108.5, up from 95 recordedduring the same period one year ago. On the other hand, netinvestment income for the third quarter improved to $123.8 million,up from $100.4 million one year ago.

Everest Re, a property-casualty reinsurer marketing to UnitedStates and international insurers, specializes in several areas,which include marine, aviation and surety, as well as medicalmalpractice, directors-and-officers liability, and professionalerrors and omissions liability. For the full-year 2003, the companyreported $426 million in net income, up 84.2 percent from $231.3million reported during 2002.