Everest Net Rises Sharply

Everest Re posted a 77 percent rise in first-quarter earnings this year compared with the same period in 2006.

The Bermuda-based reinsurer posted net income of $297.6 million, up from $168.4 million in the year-earlier quarter.

Catastrophe losses came in at $34 million compared with $68.4 million a year ago.

Morgan Stanley analyst William Wilt said the reinsurer beat his estimates by $1.18 per share. But he said investors may focus on the decrease in written premium of 3.6 percent as opposed to the flat number that was expected as a sign that demand for reinsurance may be waning.

Bank of America Securities property-casualty analyst Kevin O'Donoghue noted that reinsurance underwriting results were strongest in the United States with a combined ratio of 58.1.

For U.S. primary insurance, the company posted a $59.7 million adverse reserve charge on the runoff credit program.

In addition, net premium written declined 3.2 percent in the quarter. Mr. O'Donoghue wrote that growth was strongest in the Bermuda segment, up 7.2 percent from the first quarter of last year, but declined 16.3 percent in specialty underwriting, “worse than our expectations of a 13.1 percent decline.”