Cincinnati-based property/casualty insurer American Financial Group Inc. reported net earnings for the 2004 second quarter of $55.9 million, or 75 cents per share, significantly above the $30.5 million, or 44 cents per share, reported for the second quarter of last year. The increase reflects primarily 2003 charges for an arbitration decision in the property/casualty group and lower interest rates in the fixed annuity business, and improved earnings in the insurance operations, partly offset by lower realized gains on investments.
Net earnings for the first six months of 2004 were $129.1 million, or $1.73 per share, compared to $55.6 million, or 80 cents per share, for the same 2003 period. The increase results from higher earnings from insurance operations and net realized gains on investments versus net realized losses in the 2003 period, the company said in a statement.
Core earnings from insurance operations were $55.7 million, or 75 cents per share, for the second quarter of 2004 compared to $14.7 million, or 21 cents per share, for the previous year’s second quarter.
CEO Carl Lindner said AFG has continued to see “excellent underwriting results” in its specialty P/C operations, noting an underwriting profit of $31.9 million for the 2004 second quarter, an improvement of $14.7 million over the same period a year ago. The segment’s combined ratio was 94.0 percent, compared to 95.7 percent in the 2003 second quarter.
Continuing rate increases as well as volume growth fueled an 18 percent increase in gross written premiums for the 2004 quarter as compared to the 2003 period. Rate increases in the specialty operations averaged about 8 percent for the second quarter of 2004. Net written premium growth of 31 percent over the 2003 period, was the result of the growth in gross written premiums and the retention of a greater percentage of premiums written in certain property and transportation businesses.
Topics Property Casualty
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