Filed Under:Agent Broker, Commercial Business

FM Global Posts $32M Net Loss in 2011; Gross Premiums Up 5.4%

Correction: March 30, 9:02 a.m. EDT

NU Online News Service, March 27, 10:19 p.m. EDT

According to data compiled by SNL Financial LC, Johnston, R.I.-based mutual property insurer FM Global reported a net loss of $32 million for 2011 compared to net income of more than $767 million for the prior year.

In a statement, FM Global says it posted a combined ratio of 121, driven by 20 large natural disasters for 2011. Policyholder surplus declined by 5.5 percent to $6.9 billion with net losses incurred for disasters in 2011 exceeding losses incurred in 2010 by more than $1 billion.

The company did end 2011 with $5.1 billion of gross premium in force, an increase of 5.4 percent over the previous year, and net-earned premium grew by close to 6 percent to $3.4 billion.

“Although the frequency and severity of the natural disaster losses were our highest on record, we didn’t find it necessary to modify our risk assessment and risk-improvement practices at the policy level, or suggest a redesign of our reinsurance practices,” says Shivan S. Subramaniam, the company’s chairman and chief executive officer in a statement.

Among some of the business results the company highlighted:

  • Completed issuance of $208 million in membership credit to policyholders due to loss-prevention efforts. The company says it has reduced the premium charged to policyholders by $1.7 billion since 2001 through membership credit.
  • Has a 96 percent retention rate, the highest for FM Global in more than a decade and “significantly higher than the industry average.”
  • Issued 70 percent of national policies prior to the effective dates.
  • The company unveiled its Center for Property Risk Solutions—a 12,000 square-foot laboratory that allows the insurer’s engineers to gain hands-on experience with the loss prevention and control systems they will encounter at the company’s claim facility.

“FM Global will continue to ensure that we continue to deliver market-leading products and services that resonate with our clients and meet their ever-evolving needs on a worldwide basis,” says Subramaniam.

Correction: FM Global is a property insurance company and its policy holder surplus declined to $6.9 billion.

Featured Video

Most Recent Videos

Video Library ››

Top Story

America's 10 most dangerous cities for cyclists

Despite the relative safety of American cities for cyclists, 70% of fatal bike accidents still occur in urban areas.

Top Story

Crime doesn't pay for the newest members of the Hall of Shame

There is no honor among these scammers for the millions in fraud they perpetrated.

More Resources


eNewsletter Sign Up

Agent & Broker Insider eNewsletter

Proven success tips and essential information to help agents and brokers grow their practice – FREE. Sign Up Now!

Mobile Phone

Advertisement. Closing in 15 seconds.