ACE reports 289% increase in net income for first quarter, premiums flat
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ZURICH—ACE Ltd.'s first quarter 2012 net income rose 289% from that of the same period a year earlier to $973 million, ACE reported Tuesday.
Positive underwriting results and a drop in catastrophe losses bolstered ACE's performance. Total pre-tax catastrophe losses for the quarter were $19 million, compared with $489 million during the first quarter in 2011. Accordingly, the company's property/casualty combined ratio improved to 89.2%, compared with 105.2% during the same period last year.
Net written premiums were relatively flat at $3.57 billion for the quarter, up from $3.45 billion last year. Investment income was unchanged at $544 million.
“We and much of the industry benefited from relatively light catastrophe losses in the quarter, particularly compared to prior year,” ACE Chairman and CEO Evan G. Greenberg said in statement discussing the results. “It's noteworthy that our operating income excluding catastrophes was up 2% over the first quarter last year.”
Mr. Greenberg added that the Zurich-based insurer also benefited from improved pricing in many property-related lines of business as well as ACE's strategic decision to move away from lines of business where pricing was inadequate to justify the risks.
“Rates on our U.S. business were up 3.6% on average,” he said. “As a result, our customer retention rates improved globally and we incrementally increased our new business writings. At the same time, we continued to shed lines of business, particularly U.S. general market workers compensation, where pricing for some time has not met our standards for earning an underwriting profit.”
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