NU Online News Service, May 9, 3:56 p.m.EDT--Berkshire Hathaway Inc. reported higher earnings forits insurance business, but the company's total profit for thefirst quarter still deteriorated, falling 12 percent to $1.36billion.
|The Omaha, Neb.-based holding company, led by Warren Buffett,saw its overall first quarter income slip from $1.55 billion oneyear ago. In the latest quarter, Berkshire suffered some $307million in investment losses from foreign currency trading.
|On the positive side, Berkshire saw its underwriting income growto $319 million, up from $192 million last year. (On a pre-taxbasis, it improved to $492 million from $296 million.) Investmentincome from insurance units also rose, to $554 million from $455million.
|Among individual insurance units, the auto insurer GEICO saw itsunderwriting income increase to $312 million from $223 on a pre-taxbasis. It had $2.4 billion in earned premiums, up from $2.1billion.
|Berkshire described GEICO's first quarter underwriting resultsas "exceptional" and said that absent large catastrophe losses,GEICO's underwriting results are "expected to be favorable over theremainder of 2005."
|One concern, however, is recent rate reductions, which, whenfully effective, are expected to cut into underwritingprofitability, the company observed.
|Berkshire Hathaway Reinsurance Group's underwriting income roseto $143 million from $22 million, while Berkshire Hathaway PrimaryGroup's underwriting income doubled to $18 million from $9million.
|One insurance unit that saw deteriorating results was GeneralRe, whose underwriting income fell to $19 million from $42million.
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