Liberty Mutual 4Q Net Income Up 2 Percent

NU Online News Service, March 2, 2:31 p.m. EST

Liberty Mutual Group reported 2009 fourth quarter net income of $456 million, a 2 percent increase from $447 million recorded for the period in 2008 and it noted increases in net written premiums and strong core business performance.

For the full year of 2009, the company reported net income of $1.02 billion, down 8.1 percent from $1.11 billion in 2008.

Net written premiums for the 2009 fourth quarter were $7.1 billion, an 11.5 percent increase over the same period in 2008. The combined ratio climbed four points in the quarter to 99.3.

Liberty Mutual Chief Executive Officer Edmund Kelly said in a conference call that the U.S. auto market, which makes up two thirds of Liberty Mutual's 13 million insured autos, was profitable across the board in the quarter.

He noted that the industry is largely filing for rate increases, and that Liberty Mutual is doing the same "as needed."

Overall, he said core businesses performed well despite the weak economy and "intense competition," especially in personal lines.

For the year, net written premiums increased by 11 percent to $28.3 billion. The combined ratio was 99.9, down 0.2 points from 2008.

Revenues in the 2009 fourth quarter declined 2.6 percent to $7.9 billion.

For the year, revenues were up 7.8 percent to $31.1 billion.

Speaking to the company's exposure to the Chile earthquake, Dennis Langwell, Liberty Mutual senior vice president and chief financial officer said during the conference call that the company has a 10-11 percent market share.

He said it is too early to estimate losses, but he noted Liberty Mutual has "very significant reinsurance in place for this type of event." He said the loss will be large, but not significant.