Los Angeles-based Mercury General Corp. has announced its results for the third quarter ended Sept. 30, 2008. Net loss in the third quarter was $130.5 million, compared with net income of $63.3 million in the same period for 2007. For the first nine months of 2008, net loss was $73.8 million, compared with net income of $193.2 million for the same period in 2007.
Company-wide net premiums written were $695.1 million in the third quarter of 2008, an 8.4 percent decrease over the third quarter 2007 net premiums written of $758.8 million, and were approximately $2.1 billion for the first nine months of 2008, a 7.6 percent decrease over the same period in 207.
California net premiums written were $544.3 million in the third quarter of 2008, a decrease of 7.4 percent over teh same period in 2007, and were approximately $1.7 billion for the first nine months of 2008, a 5.8 percent decrease over the same period in 2007.
Total catastrophe losses, which resulted primarily from Hurricane Ike, were $6 million in the third quarter of 2008. There were no catastrophe losses recorded in 2007, the company indicated.
The combined ratio for the three months ended 2008 was 102 percent, compared to a 94.2 percent combined ratio in the same period in 2007.
According to Mercury, it “sustained a decline in municipal bond prices throughout the nine months of 2008, resulting from bond insurer credit downgrades, market liquidity problems and wider credit spreads. Additionally, the price declines on corporate and equity holdings of the company mirrored the sell-off in the overall market during the third quarter of 2008, as investors became more risk averse and global economic pessimism increased.”
The company also noted that on July 1, 2008, the California Superior Court ruled in its favor in a case filed against the California Franchise Tax Board, entitling the company to a tax refund of $24.5 million, including interest. The time period for appeal has passed.
For more information, visit www.mercuryinsurance.com.
Source: Mercury Insurance
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