Berkley Records Q3 Loss; Sees New Units Benefiting from Market Turmoil

W. R. Berkley Corp. reported a net loss for the third quarter of 2008 of $28 million, compared with net income of $180 million, for the third quarter of 2007.

Operating income for the third quarter of 2008 was $123 million, compared to $180 million for the corresponding quarter of 2007.

Gross premiums written were $1.1 billion compared to $1.2 billion for the quarter last year.

Third quarter highlights included:

Operating return on equity was 13.8 percent on an annualized basis, after weather-related losses.
GAAP combined ratio was 96.2 percent, inclusive of 5.8 points from weather-related losses.
The company repurchased 1.9 million shares of its common stock.

“Challenges stemming from the global investment environment and an unusual number of natural disasters had an adverse impact on third-quarter profits. Still, we remain very well-positioned to take advantage of what we see as an improving property casualty insurance marketplace, said William R. Berkley, chairman and chief executive officer.

Berkley said the quarter showed a modest reduction in the rate of price changes. “While we have yet to see price increases, we believe the tide is showing signs of turning,” he said.

He also said the company has been pleased with the early progress of its newest underwriting units. In the past six months, the company has formed units targeting personal and commercial assets, professional liability, Canadian markets and, most recently, oil and gas production facilities.

“The current industry turmoil is giving us better traction than originally anticipated,” Berkley said of the new ventures.

Source: W.R. Berkley Corp.