Liberty Mutual's operating results improved and catastrophe losses have been modest, leading to 2012 third-quarter net income of $465 million, compared to a $112 million net loss in 2011's third quarter.
Due to Hurricane Sandy, Liberty Mutual canceled its third-quarter conference call with analysts, but in a statement, President and CEO David H. Long says, "Positive price momentum exists across most lines with the magnitude of increases targeted to where it is needed most, workers compensation and property. This pricing trend will continue given the persistent low-yield environment."
He adds that Liberty Mutual saw growth "where we targeted — personal lines and international — and contraction in underpriced commercial business."
Liberty Mutual's combined ratio for the quarter improved to 98.5, down by 12.2 points compared to last year.
Operating income was $469 million in 2012's third quarter, up from $340 million in 2011's third quarter.
Net written premiums climbed by $515 million in the quarter to $8.65 billion.
For the first nine months of the year, Liberty Mutual's net income climbed by $990 million to $1.1 billion. The nine-month combined ratio improved by 6.9 points to 101.7, and net written premiums rose by $1.58 billion to $25.06 billion.
Looking forward, Liberty Mutual may be in for higher cat losses in the fourth quarter, as Fitch Ratings listed the company as one of the primary insurers expected to bear the brunt of losses from "Superstorm" Sandy.
AIR Worldwide says it expects Sandy losses to be between $7 billion and $15 billion, while Eqecat puts expected losses between $5 billion and $10 billion.
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