PMA Capital Swings To Profit
NU Online News Service, Aug. 7, 10:45 a.m. EDT?PMA Capital Corporation, a Philadelphia-based holding company for several Mid-Atlantic and Southern insurers, posted $12.2 million for its second-quarter profit, in contrast to the year-ago period when the company reported a net loss of $29.7 million.
One of the positive factors reported by PMA was the improvement in its investment income--for the last quarter, PMA reported $2.9 million in investment gains, compared to net realized investment losses of $11.4 million posted one year ago. The overall losses from the year-ago period also reflected a $28 million charge to exit from its excess and surplus lines market.
Overall revenues for the last quarter also improved to 312.6 million, from $284.1 million posted a year ago. Additionally, net written premiums also increased to $290.7 million, compared to $302.5 million from the 2002 second quarter.
Commenting on the company's latest financial results, John Smithson, chief executive officer at PMA Capital, said he continues to see favorable market conditions, "characterized by firming and adequate pricing in our major lines of business."
Mr. Smithson added, "For many lines of business, 2003 represents the third round of price increases in as many years, with nearly every segment of the market experiencing three rounds of double-digit rate increases since 2000."
Furthermore, rate hikes continue to be strong at PMA Capital this year, Mr. Smithson observed, with the company's workers' compensation business getting 11 percent price hikes and other commercial lines going up by 16 percent.
He said PMA Re premiums jumped by some 30 percent on traditional treaty and specialty treaty business that was renewed through the first half of the year, Mr. Smithson.
PMA Re, a subsidiary of PMA Capital, buys high-risk policies through brokers on an excess-of-loss basis. PMA Capital also has a number of insurance units under its PMA Insurance Group trade name, and these subsidiaries underwrite workers' compensation and commercial insurance. Last year, the company posted $48 million in net loss, with more than $1 billion in sales.
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