Liberty Mutual Group reported today that that 2006 fourth quarter net income increased nearly 100 percent compared to the same year-ago period.

The Boston-based carrier reported net income of $455 million, compared to $253 million in the same 2005 period.

The company attributed the results to the continuation of strong current accident year underwriting and investment results, and lower catastrophe losses.

In a conference call this morning, Liberty Chief Executive Officer Edmund Kelly said the numbers reflected just the right balance between profitability and growth.

But he did express concerns about possible price softening this year.

“In terms of commercial, we have a lot of capital sloshing out there with companies that did not meet their revenue targets coming back with a vengeance,” he said.

He expects some moderate price decreases with terms and conditions holding firm for the most part.

Private passenger auto rates, he said, may see some state-mandated decreases as a result of favorable claims experience.

Florida lawmakers, in Mr. Kelly's opinion, “rolled the dice” earlier this year just as the market was starting to get reasonably priced. The Legislature approved a rate rollback for its residual homeowners market as well as expansion of the Florida Hurricane Catastrophe Fund to provide low cost reinsurance.

While vowing no broad-based exit from catastrophe-prone areas, Mr. Kelly said the company will be making some “surgical cuts” in the area.

The company also reported revenues increased 9 percent to $6 billion.

Net written premium was listed as $4.8 billion, an increase of $363 million or 8.2 percent over the same period in 2005.

Special Reports /

Liberty Fourth Quarter Net Soars

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