Property and casualty (P&C) insurance company The Hanover Insurance Group, Inc. has reported net income of $34.0 million for the third quarter of 2021, compared to $118.9 million for the same period last year.
The considerable drop in performance can be mainly attributed to the $153.5 million of catastrophe losses that the company booked in the quarter, including $75.0 million from Hurricane Ida.
This resulted in a combined ratio of 102.3%, compared to 94.2%, although when discounting cat losses this would move to 89.4%, The Hanover noted.
Net investment income was $78.8 million, up 16.6% from the prior-year quarter, primarily from higher partnership income.
Looking at the first nine months of the year, net income came to $255.2 million, compared with $194.1 million for the 9M period last year.
The combined ratio for this period is 98.5% and net investment income is recorded at $231.2 million.
“We are very pleased with our strong, sustained growth in the quarter, as well as our solid bottom line performance in the face of considerable catastrophe activity,” said John C. Roche, President and CEO at The Hanover.
“We increased net premiums written by 8.4%, powered by the successful execution of our agency- and customer-focused strategy, with important contributions from each segment. Our growth reflects continued strong rate in Commercial Lines and a more measured pricing strategy intended to build long-term value in Personal Lines.”
“Our high-quality, diversified business performed well once again, in spite of the challenges presented in the quarter, including the severe weather and inflationary pressures that impacted the industry largely in personal lines,” Roche continued.
“Although some lines experienced more pressure than others, we delivered an underlying loss result in line with our third quarter targets, due largely to the diversification we have managed in our book and the broad-based profitability we are achieving across our business. Our losses from Hurricane Ida were in line or better relative to the industry due to our continued focus on exposure management and data and analytics. As we look ahead, we remain committed to managing our business for sustainable long-term, profitable performance.”