Connecticut-based W.R. Berkley Corp. bounced back strongly from last year’s losses, reporting $53.040 million in operating earnings and $72.731 million net income for the fourth quarter, compared to a $10.606 million operating loss and a $64.164 million net loss in 2001.
The company’s full-year results were equally good – $160.655 million in operating profits; $175.045 million in net income and a 32 percent rise in gross premiums written from $2.208 billion in 2001 to $3.208 billion last year.
Other highlights announced in Berkley’s report included:
*Gross premiums written for continuing business grew 56 percent in the fourth quarter to $885 million;
*GAAP combined ratio for continuing business was 93.3 percent in the fourth quarter compared with a combined ratio of 112.4 percent in the prior year quarter;
*The paid loss ratio for continuing business decreased to 43.5 percent in the fourth quarter from 61.0 percent in the prior year quarter, and the paid-to-incurred loss ratio decreased to 67.8 percent in 2002 from 76.8 percent in 2001;
*Cash flow from operations increased to $223 million in the fourth quarter compared with $81 million in the prior year quarter. For the full year, cash flow from operations increased to $766 million from $210 million in 2001.
Commenting on the Company’s results, William Berkley, chairman and CEO, noted, “Our excellent results continue to reflect strategic decisions made over the past several years to consolidate our operations and focus on our most profitable lines of business. This focus also resulted in the early recognition of past reserve deficiencies, and thus, we are able to reflect in our current results the benefits of higher prices and improved terms and conditions.”
He noted that the company was continuing to be cautious in its reserving practices “to guard against the possibility of future adverse reserve development,” and added that, “We believe our current financial statements reflect a prudent view in an uncertain world.”
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