Liberty Mutual Group management said domestic and international premium growth pushed up first quarter net income by 2.9 percent to $360 million.
Net written premiums increased 10 percent to $6.3 billion in the quarter compared to the same period in 2007, the company reported.
Edmund F. Kelly, chairman, president and chief executive officer of Liberty Mutual said that net written premium internationally grew by 31.7 percent.
He said that much of that growth was due to the strength of international currencies against the dollar, but he noted that the company now insures 4.2 million autos outside the United States. Mr. Kelly described the international auto market as becoming competitive.
Domestically, Mr. Kelly said that competition and rate decreases have impacted profitability and loss ratios across the market, and he said that more companies are now filing for rate increases.
Policy growth domestically has been "excellent," Mr. Kelly said. He attributed much of the growth to acquisitions, including the 2007 acquisition of Ohio Casualty, but Mr. Kelly also said organic growth both domestically and internationally has been strong.
The combined ratio for the quarter was 100.7, a 0.4 point decrease compared to 2007. Not including catastrophes, the combined ratio was 99.1, the same as the first quarter of 2007.
During a conference call, Dennis J. Langwell, Liberty Mutual's senior vice president and chief financial officer said that realized investment gains declined $92 million to a net loss of $12 million for the quarter.
But, net investment income is up 12.5 percent due to an increase in taxable and tax-exempt interest income of $72 million, which comes from a higher invested asset base from strong cash flow over the year, Mr. Langwell said.
Speaking to the results of the quarter, Mr. Kelly said in a statement, "Despite significant competition, higher catastrophe losses, and a global credit crisis, our results in the quarter were solid. Domestic premium growth and profitability were strong, enhanced by our acquisition of Ohio Casualty in 2007 and continued growth in our international operations, including the strength of foreign currencies versus the U.S. dollar. Our investment results were also strong, reflecting minimal exposure to sub-prime mortgages."
Liberty Mutual also noted that its acquisition of Safeco, made after the close of the first quarter, is targeted to close in the third quarter of this year.
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