Liberty Mutual Group reported 2007 fourth-quarter net income declined by 6.6 compared with the period in 2006.
Net written premium for the quarter totaled $5.579 billion, an increase of $764 million over 2006. This growth was driven by Liberty Mutual's acquisition of Ohio Casualty and growth in international operations, the company said.
The insurer said net income for all of 2007 was $1.518 billion, down 6.6 percent from 2006. The decline was primarily attributed to increased competition in the marketplace, which led to a reduction of rates in most lines of both the commercial and personal markets.
The company reported net written premium for the year at $22.5 billion, an increase of $1.91 billion over 2006.
The combined ratio for the quarter was 101, off by 2.9 points from 98.1 in 2006. The combined ratio for the year deteriorated by one point to 100.3, up from 99.3 in 2006.
Edmund F. Kelly, chairman, president and CEO of Liberty Mutual, highlighted the company's above-average growth rate, stating that it reflects "the success of our distribution channel diversification, growth in international and, of course, the acquisition of Ohio Casualty," which was effective as of late August.
"Operating results were at or near record levels. Revenues for the year were just shy of $26 billion. Each of our businesses continues to perform well in terms of both growth and profitability, and investment returns on our equity portfolio, both public and private, continue to outperform all major indices," Mr. Kelly said.
Speaking to the state of the market, Mr. Kelly said, "We still see market conditions as competitive, but margins still remain attractive." He added that rates are declining overall, but he maintained that pricing is still "rational."
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