NU Online News Service, Oct. 28, 3:45 p.m. EDT
ACE Limited reported third-quarter net income of $494 million, an 815 percent increase over 2008 third-quarter net income of $54 million.
The Zurich-based insurer wrote less in premiums than a year ago but suffered fewer losses, resulting in higher underwriting income, management said.
For the first nine months of 2009, the company reported net income of $1.6 billion, up from 1.2 billion for the same time period in 2008.
ACE reported $5 billion in gross premiums written for the quarter and $3.4 billion in net premiums earned, compared to $5.2 billion and $3.6 billion, respectively, in last year's third quarter.
The combined ratio improved to 88.1 compared to 97.9 in the 2008 third quarter.
ACE reported 2009 third-quarter underwriting income of $411 million, up from $111 million a year ago.
Net investment income fell to $511 million in the quarter from 2008 third-quarter net investment income of $520 million.
In a conference call, Evan G. Greenberg, chairman and chief executive officer of ACE, said, "Interest rates are low, and that puts pressure on investment income growth; however, our positive cash flow and consequent growth in invested assets and portfolio repositioning help ameliorate that somewhat."
In a statement, Mr. Greenberg said of the company's results in general, "ACE had an excellent third quarter with all divisions of the company performing well and contributing to results. Our book value grew 13 percent in the quarter, 30 percent for the year, and stands at an all-time high."
Regarding the lower premiums earned compared to the previous year's third quarter, Mr. Greenberg said, "Premium revenue growth was impacted in the quarter by recessionary conditions, a strong U.S. dollar and a competitive insurance market.
"Growth in the period benefited, however, from customers seeking ACE's strong balance sheet as well as our broad product portfolio and global presence. By the nature of some of our businesses, growth can be volatile quarter to quarter, but more stable when viewed over a longer period of time. In fact, we expect meaningfully stronger revenue growth in the fourth quarter regardless of foreign exchange."
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