The Hanover Insurance Group, Inc. reported net income for the third quarter of $33.4 million, or $0.65 per share, compared to a net loss of $562.4 million, or $10.51 per share, in the third quarter of last year.
The current quarter’s results include a $34 million charge, or $0.66 per share, of after-tax net losses related to Hurricane Katrina. Last year’s third quarter net loss is attributed to a $474.6 million after-tax net loss on the sale of the variable life insurance and annuity business and $140 million in after-tax net catastrophe losses related to Hurricane Katrina.
Income from continuing operations was $28.5 million for the third quarter, or $0.56 per share, compared to a loss of $105.4 million, or $1.97 per share, in the third quarter of last year. Results for both quarters include the impact of the aforementioned catastrophe losses related to Hurricane Katrina and several other much less significant items.
Total property and casualty pre-tax segment income was $52.8 million in the quarter, compared to a loss of $127.7 million in the third quarter of last year. The current quarter’s results include $64.2 million of net pre-tax catastrophe losses and loss adjustment expenses, of which $52.1 million relate to a reserve increase attributable to Hurricane Katrina.
In addition, current quarter results also include the benefit of a $7.0 million litigation settlement related to Opus Investment Management, Inc. Results from the third quarter of last year include pre-tax net catastrophe related losses of $245.5 million primarily attributed to Hurricane Katrina.
“We continue to be very pleased with the progress we are making throughout our organization,” said Frederick H. Eppinger, chief executive officer of The Hanover Insurance Group, Inc. “In spite of the additional Hurricane Katrina losses, we generated solid results in the quarter, reflected in the positive momentum we have established in both commercial and personal lines.”
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