Beazley P.L.C. posted pretax profit of $82.3 million for the first half of 2013, down from $112.9 million for the same period in 2012.

The Dublin-based insurer and reinsurer, which operates five syndicates at Lloyd's of London, said its profit was affected by reduced investment income and the impact of foreign exchange losses. For the first six months of 2013, Beazley posted an investment return of $300,000, compared with $36.1 million for the first half of 2012.

In a statement Tuesday, Beazley said that while an increase in U.S. interest rates during the first half of the year were good for its underwriting business, “the rise in rates created mark-to-market losses in the fixed income portfolio that canceled out the profits we had made earlier in the year.”

Beazley posted gross written premiums of $1.07 billion, up from $1.01 billion for the first six months of 2012.

The company posted a combined ratio of 89% for the first half of 2013, compared with 91% for the first half of 2012.

Prior-year reserve releases totaled $60.8 million, the company said, compared with $47.6 million in the first half of 2012.

Beazley CEO Andrew Horton said the company's losses from recent severe flooding in Europe would fall within a $30 million reinsurance retention.

Overall, rate increases on renewal business were 1% on average, Mr. Horton said, compared with 3% for the first half of 2012.

Reinsurance rates fell by about 1%, in part because of an influx of new nontraditional capacity into the market, Beazley noted.

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For specialty lines business, which accounts for more than one-third of Beazley’s premiums, rates on renewal business increased by an average of 4% during the first half of the year, the company said.

Rates for marine, political risks and contingency business fell an average of 2%, the company said.

In briefing note, Tom Carstairs, an analyst at Berenberg Bank, said that Beazley’s investment return had been “materially below” his forecast of $21 million. He added that despite reserve releases, he believed that Beazley had maintained a conservative reserving approach.

Mr. Carstairs also said the competitive market was “likely to be a theme across the reporting season for both Lloyd’s and the European reinsurance companies.”