A.M. Best reported dismal news for the nation's P&C industry's first-quarter results. The rating organization's recent study showed that net profit nose-dived a stunning 45 percent, to $9.3 billion, in the first quarter of 2008. Best attributed the results primarily to premium erosion, deteriorating underwriting results, higher catastrophe-related losses, and weaker investment returns. Also noted were significant underwriting losses in the mortgage and financial guaranty segments. Although the industry did report some gains in significant areas, overall the news was not good. Key findings and commentary from the report, available at www.bestweek.com, include:

-First-quarter 2008 catastrophe losses in the United States were the largest for similar timeframes over the past decade: an estimated $3.35 billion, up from $1.26 billion during the same period of 2007.

-Annualized after-tax return on equity, which measures overall after-tax profitability from underwriting and investments, fell to 11.4 percent for the 12 months ended March 31, from 14.7 percent for the 12 previous months.

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