LONDON (Bloomberg)—Chaucer Holdings P.L.C., a Lloyd’s of London insurer, posted a 58% drop in first-half profit as investment returns fell and the company faced claims related to the earthquake in Chile and the Deepwater Horizon oil spill.

Pretax profit declined to £7 million ($10.9 million) from £17 million ($26.4 million) a year earlier, the London-based company said Thursday in a statement. That beat the £6.9 million ($10.7 million) median estimate of five analysts surveyed by Bloomberg.

“Given the conditions and catastrophe losses in the first quarter, it’s a satisfactory outcome for the group,” said Eamonn Flanagan, a Liverpool, England-based insurance analyst at Shore Capital P.L.C. who has a “buy” rating on the stock.

The company left its estimates unchanged for losses related to the earthquake, the Gulf of Mexico oil spill and European winter storm Xynthia. It expects losses related to Deepwater Horizon of about $25 million and a net loss from the earthquake in Chile and Xynthia of £25 million ($38.8 million). It also had losses of £10.7 million ($16.6 million) related to riots in Bangkok in May.

“It has been an exceptional period for natural and man-made catastrophes,” CEO Robert Stuchbery said in the statement. “We are taking advantage of the positive market conditions arising from these events, particularly within the energy market, where we are already seeing good rate increases.”

Chaucer, which was subject to takeover bids from Novae Group P.L.C. and Brit Insurance Holdings N.V. last year, began redeeming its holdings in hedge funds in 2009, which contributed to an investment loss for 2008. Chaucer’s investments returned £17.7 million ($27.5 million) in the first half, compared with £34.6 million ($53.7 million) in the same period last year.

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