Posted on 20 Mar 2013 by Neilson
FM Global posted net income of $774 million for year-end 2012 with a combined ratio of 85.7, despite the impact of Hurricane Sandy.
Sandy was the insurer's single-largest net aggregate natural disaster loss to date, which resulted in about 2,200 claims, the company said. It did not give a dollar amount for Sandy claims.
It ended the year with $5.5 billion of consolidated gross premium in force, an increase of 8.6%. Policyholder surplus grew 14.9% to $7.9 billion.
"FM Global's financial capacity enabled us to absorb the losses we incurred from one of the costliest natural disasters in our company's 178-year history with manageable impact to our bottom line," Shivan S. Subramaniam, chairman and chief executive officer, said in a statement.
Last year, FM Global said it ended 2011 with $5.1 billion of gross premium in force, an increase of 5.4% over 2010. The mutual insurance company posted a combined ratio of 121 for 2011, driven by the 20 large natural disasters of 2011, and policyholder surplus declined by 5.5% to $6.9 billion.
The company reported its results in GAAP.
Other highlights from 2012 included the company launching an Asia/Pacific division based in Singapore.
While most of the largest allied lines writers in New York and New Jersey saw their adjusted loss ratios spike dramatically in 2012, FM Global turned in one of the lowest adjusted loss ratios, according to insurance company annual data available in BestLink, www.ambest.com/bestlink.
Allied lines are coverages written with property insurance, including glass, tornado, windstorm and hail and excess flood.
Eight of the top 10 largest allied lines writers in New York posted triple digit adjusted loss ratios, with five of them north of 200. FM Global Group's 3.26 adjusted loss ratio is the lowest in the top 10, and one of the lowest in the industry.