Bermuda-based insurer White Mountain reported 2007fourth-quarter net income fell 66 percent, with drops in income inboth its reinsurance and personal line auto divisions.

The company reported that consolidated net income in the fourthquarter compared to the same period in 2006 was down by $198million to $101 million. Earnings per share dropped $18.15 a shareto $9.55. Revenues were down 11 percent in the quarter, falling by$148 million to $1.2 billion.

For the year, net income fell 39 percent compared to 2006, downby $266 million to $407 million. Earnings per share dropped $24.43to $37.89 a share. Revenues for the year were off more than 1percent, or $60 million, to $4.7 billion.

In its insurance segments, only OneBeacon showed gains with netincome at $83 million, up by $18 million in the fourth quartercompared to the same period for 2006. For the year, the insurerreported pre-tax income grew to $399 million, up $87 million, withits combined ratio at 93, a three-point improvement.

White Mountain Re and Esurance did not fare as well.

White Mountain Re pre-tax income fell to $80 million, down by$26 million in the quarter, reporting a combined ratio of 92 forthe quarter, a seven-point deterioration.

Esurance reported a pre-tax loss of $27 million compared to aloss of $8 million in 2006. Its combined ratio ballooned to 120from 109 in the fourth quarter of 2006. For the year, pre-tax losswas $73 million compared to a loss of $8 million in 2006. Thecombined ratio was 116, up 8 points.

White Mountain Re was hit by $76 million in losses fromcatastrophe losses from winter storms Kyrill and Hanno and floodingin the United Kingdom.

Esurance was squeezed by intense competition in the personallines auto market along with increased loss frequency. The companysaid it is addressing this issue with increases in severalstates.

In a statement, Ray Barrette, chairman and chief executiveofficer of Hamilton, Bermuda-based White Mountain, said the company"had a good year" by avoiding the "subprime mess" and continuing togenerate solid returns on its investment portfolio.

Despite is losses, he said, the company remains confident aboutEsurance, its online auto insurance company, calling it "a superiorbusiness."

"We are leaving no stone unturned in our search to add value inthese volatile markets," he said.