Allmerica Financial Corporation (NYSE: AFC) in Worcester, Mass. has reported third quarter net income of $17.7 million, or $0.33 per share, compared to net income of $11.4 million, or $0.21 per share, in the third quarter of last year.
Total segment income after taxes was $19.6 million, or $0.37 per share, consistent with $19.7 million or $0.37 per share, in the third quarter of last year.
The property and casualty business reported solid pre-tax segment earnings in the quarter despite being materially impacted by catastrophe losses primarily related to hurricanes in the Southeast.
During the quarter, the company incurred gross catastrophe losses of approximately $99 million, primarily related to hurricanes in the Southeast. After reinsurance, pre-tax catastrophe losses were approximately $62 million compared to $17 million in the comparable period one year earlier.
“I am proud of the prompt, high quality service we provided to our agents and customers in the aftermath of the recent hurricanes.” said Frederick H. Eppinger, president and chief executive officer of Allmerica Financial Corporation. “Despite the catastrophe losses, I am pleased that we reported strong property and casualty earnings.”
Allmerica Financial consists of property and casualty operations, which represents our ongoing business, and life operations, which is a run-off business consisting primarily of proprietary life insurance, annuity and guaranteed investment products previously issued by Allmerica’s life insurance subsidiaries.
The company conducts its business in four operating segments. Property and casualty operations consist of three operating segments: Personal Lines, Commercial Lines, and Other Property and Casualty. The Personal Lines segment markets automobile, homeowners and ancillary coverages to individuals and families. The Commercial Lines segment offers a suite of products targeted at the small to mid-size business markets, which include commercial multiple peril, commercial automobile, workers’ compensation and other commercial coverages. The Other Property and Casualty segment includes a block of run-off voluntary pools business in which we have not actively participated since 1995; AMGRO, Inc., a premium financing business; and Opus Investment Management, Inc., which provides investment management services to institutions, pension funds and other organizations. The Life Companies, our fourth operating segment, includes the results of our run-off business of life and annuity products and guaranteed investment contracts.
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