Hanover Insurance Group Reports 1Q Results

Worcester, MA (CompNewsNetwork) - First Quarter 2010 Financial Highlights are listed below:

- Net income of $41.8 million, or $0.87 per share, compared to net income of $25.8 million, or $0.50 per share, in the prior-year quarter

- After-tax segment income of $32.0 million, or $0.66 per share, compared to $26.4 million, or $0.51 per share, in the prior-year quarter(1)

- Combined ratio of 99.7%, compared to 101.1% in the prior-year quarter; ex-catastrophe combined ratio(2) of 94.5%, compared to 95.2% in the prior-year quarter

- Net premiums written of $725.2 million, compared to $629.9 million in the prior-year quarter, an increase of 15.1%

- Book value per share of $51.59 at March 31, 2010, compared to $49.72 per share at December 31, 2009, and $38.62 at March 31, 2009, an increase of 3.8% and 33.6%, respectively

The Hanover Insurance Group, Inc. (NYSE: THG) today reported net income for the first quarter of 2010 of $41.8 million, or $0.87 per share, compared to $25.8 million, or $0.50 per share, in the first quarter of the prior year.  Net income for the first quarter of 2010 included $10.9 million, or $0.23 per share, of net realized investment gains, compared to a $6.1 million, or $0.12 per share, loss in the prior-year quarter.  Net income for the prior-year quarter included a gain from discontinued operations of $5.6 million, or $0.11 per share, from our previously sold life businesses, compared to $0.4 million loss from discontinued operations in the first quarter of 2010.

Total Property and Casualty segment income before interest expense and taxes(1) was $57.7 million in the first quarter of 2010, compared to $49.9 million in the first quarter of the prior year.  The pre-tax net impact of catastrophes was $34.4 million in the first quarter of 2010, compared to $37.4 million in the first quarter of 2009.

“I am very pleased with our Company's performance in the quarter,” said Frederick H. Eppinger, chief executive officer at The Hanover. “It was a difficult weather quarter for the insurance industry as a whole, and accordingly, we had an elevated level of catastrophe losses.  However, our core loss performance improved over prior periods and we were able to deliver a combined ratio below 100.  We had industry-leading growth during the quarter, driven by recent investments we have made in our commercial and specialty businesses, both of which position us to achieve an improved earnings trajectory in future periods. As a result of this growth, our net written premiums in commercial lines were more than 50% of our total net written premiums in the quarter. We also continue to achieve rate increases, most notably in personal lines.  And lastly, as a result of our earnings, unrealized investment gains and capital management actions, book value per share increased almost 4% for the quarter, as we continue to build value for our shareholders.” 

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