Mercury General Corporation has reported a net income of $107 million for the first quarter of 2021, after having fallen to a $139 million loss in the prior year quarter.
This turn around was largely driven by the company’s investment performance, having registered a $231 million improvement after having announced $198 million losses in the first quarter of 2020.
Catastrophe losses across the first three months of 2021 totalled approximately $39 million, with no reinsurance benefits used for these losses, resulting primarily from the deep freeze in Texas and Oklahoma and winter storms in California.
These losses were partially offset by favourable development of approximately $4 million on prior years’ catastrophe losses.
The company experienced favourable development of approximately $1 million on prior accident years’ loss and loss adjustment expense reserves.
Meanwhile, Mercury’s combined ratio improved by 2.4 points from 95.4% in 2020 to 93.5%.
Operating income for Q1 2021 also improved, moving 24.8% from the prior year quarter from $59.3 million to $74 million