Catastrophe losses contribute to diminished profits for XL Group

HAMILTON, Bermuda—XL Group P.L.C. announced profit of $40.8 million for the first nine months of 2011, compared with $397.4 million for the same period last year.

Hamilton, Bermuda-based XL said Tuesday that profit for the third quarter of 2011 was $42.4 million, compared with $77.5 million for the third quarter of 2010.

XL said third-quarter profits decreased largely because of higher natural catastrophe losses and lower levels of positive prior-year loss development.

For the first nine months of 2011, XL recorded gross written premiums of $5.64 billion for its property/casualty operations, compared with $4.95 billion for the first nine months of 2010.

XL said its life operations posted gross written premiums of $298.5 million for the first nine months of 2011 compared with $309.7 million for the same period in 2010.

XL said its net investment income for the first nine months of 2011 was $886.9 million, compared with $907.7 million for the first nine months of 2010.

Mike McGavick, the company’s CEO, said in a statement that rate increases were now being seen in many sectors of the market.

“The (third) quarter saw accelerating rate achievement in most lines. In far more parts of the market the long overdue response to unrealistic pricing is under way,” he said.