(Bloomberg) -- State Farm MutualAutomobile Insurance Co., the largest U.S. property-casualtyinsurer, said 2015 profit rose 48% on investment gains tied topharmaceutical holdings.

Net income increased to $6.2 billion from $4.2 billion in 2014,the Bloomington, Illinois-based company said Friday in a statementon its website. The 2015 results included a $3 billion increase incapital gains as the insurer booked profits when Actavis Plccompleted its takeover of Allergan Inc., and Merck KgaA acquiredSigma-Aldrich Corp. State Farm had stakes in both of the targetcompanies.

The insurer is one of the largest investors in companiesincluding Walt Disney Co., Johnson & Johnson, Exxon Mobil Corp.and Wells Fargo & Co., and counts on long-term stock gains toovercome losses from car coverage. State Farm’s auto underwritingloss widened to $4.4 billion in 2015 from $3.4 billion a yearearlier, as claims costs rose.

Chief Executive Officer Michael Tipsord isseeking to protect market share from rivals such as Geico andAllstate Corp. while contending with an industrywide increase inclaims costs for auto policies. Insurers are concerned that, in thelong term, car ownership will decline, squeezing insurance sales.The more immediate pressure comes from lower gas prices, whichencourage drivers to spend more time behind the wheel, increasingthe frequency of car accidents.

CEO transition

Tipsord was promoted last year to the top post from chiefoperating officer. He replaced Edward Rust, who oversaw theinsurer’s expansion during three decades as CEO. State Farm also sells homeinsurance and life policies.

Rust’s compensation climbed 3.7% last year to $13.3 million,said Dave Phillips, a spokesman for the insurer. The figure is tiedto results spanning three years, including metrics of financialresults, growth, customer retention and employee satisfaction, hesaid in a phone interview. State Farm won’t release Tipsord’s payuntil 2017, according to the spokesman.

Net worth, a measure of assets minus liabilities, climbed to$82.7 billion on Dec. 31 from $80 billion a year earlier.

The results at State Farm compare with a 24% decrease at Allstate, whichposted 2015 net income of $2.17 billion. Tipsord’s company, whichis owned by policyholders and has no publicly traded debt, reportsresults once a year and uses state accounting rules for insurers.Publicly traded insurers must use U.S. generally acceptedaccounting principles, making comparisons inexact.

Related: 20 auto insurance companies ranked from worst tobest by consumers

Are you following us on Facebook?

Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.