New book by Larry Connors Click here Improve your trading - See how
In commenting that the commercial market remained competitive, Edmund F. Kelly, chairman, president and chief executive officer of Liberty Mutual, said during a conference call that there are "some signs of stabilization" from most carriers, but not all.
"A major insurer -- AIG -- has intensified its efforts to increase market share, or at least preserve it," Kelly said. "It's fair to say they are doing some very stupid things in the market."
AIG is focused more on government and capital and is "paying little attention to what is actually going on in the trenches," Kelly said.
Kristian P. Moor, AIG executive vice president for domestic general insurance and president and chief executive of AIG Property Casualty Group, said in a conference call on Nov. 10 that AIG (NYSE: AIG | Quote | Chart | News | PowerRating) officials rejected what they termed allegations by some competitors that AIG was using extremely low rates to maintain market share. Moor said the company's commercial segment is maintaining underwriting integrity and that he believes the "allegations of excessive price cutting are coming from certain carriers frustrated by their inability to win significant market share" from AIG.
AIG reached a new agreement with the federal government recently as it reported a third-quarter net loss of $24.47 billion (BestWire, Nov. 10, 2008).
Liberty Mutual reported third-quarter net income of $6 million, compared with $404 million during the same period in 2007. Revenues were up 4.3% during the quarter to about $6.9 billion. The company's combined ratio for the quarter increased 4.4 points to 103.4.
Kelly said the company experienced about $800 million in losses, before taxes, due to catastrophes. Hurricanes Ike and Gustav in September caused about $697 million in losses. In addition, Liberty Mutual reported $250 million in investment losses before taxes.
Considering the circumstances, Kelly said he was pleased with Liberty Mutual's ability to post a profit during the quarter. "We're not cheering, obviously, but we're very pleased," he said.
Most of Liberty Mutual's rate filings or automobile and homeowners coverages were for increases, Kelly said. In homeowners, increases were requested to recoup losses from tornadoes in the Midwest last year. Net written premiums for the third quarter were $6.5 billion, a 13% increase from the same period a year ago.
Liberty Mutual completed its purchase of Safeco Corp. on Sept. 22. for $6.2 billion, or $68.25 per share in cash. Kelly said the company is integrating Safeco operations into its Agency Markets and hopes that the combination will "enhance future earnings." Post-merger integration of the companies includes coordinating 15,000 independent agencies Liberty Mutual owns after adding Safeco to Agency Markets.
Liberty Mutual Insurance Cos. currently has a Best's Financial Strength Rating of A (Excellent).
(By Chad Hemenway, associate editor, BestWeek: Chad.Hemenway@ambest.com)
More News:
Market Updates |
Stock Alerts |
All Trading News |
Stock Index
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
The Connors Group, Inc.
10 Exchange Place, Suite 1800
Jersey City, NJ 07302
© Copyright 2009 The Connors Group, Inc.
