NU Online News Service, May 9, 12:27 p.m.EDT

A reduction in catastrophe losses allowed XL Group to swing to afirst-quarter profit after suffering a loss in 2011's firstquarter.

The Dublin-based global insurer and reinsurer says first-quarternatural-catastrophe losses were $20 million, net of reinsurance andreinstatement premiums, compared to natural-catastrophe lossesof $387.4 million during last year's first quarter.

Net income after the first three months of 2012 was $176.6million, compared to a net loss of $227.3 million a year ago, saysXL.

First-quarter operating income improved to a net gain of$165.2 million, compared to an operating loss of $163 millionduring 2011's first quarter.

The property and casualty loss ratio was 32.2 percentage pointslower than the prior year quarter. The ratio includes favorableprior-year development of $80.3 million, compared to $71.0 millionlast year.

XL reports a first-quarter combined ratio of 95.3, down from125.8 a year ago. The insurance segment combined ratio improved to101.2 from 121 last year and the reinsurance segment's combinedratio for the quarter was 82.4.

Underwriting income was $63.2 million during the first quartercompared to a loss of $328.1 million.

During a conference call, Chief Executive Officer Michael S.McGavick says P&C gross premiums written increased more than 10percent from 2011's first quarter—with gross premiums written inthe insurance segment up 9.3 percent “as a result of new-businessinitiatives in North American property and casualty lines, higherretention levels in our profitable professional lines, and improvedpricing.”

He adds, “Pricing improved in each month of the first quarter.North American property and casualty rate growth was 5 percent inthe first quarter and rate achievement was accelerating throughoutthe quarter.”