This excerpt taken from the RLI 8-K filed Apr 14, 2005.
All segments report profitable underwriting
RLI reported a first quarter underwriting profit of $26.4 million on a 78.8 net GAAP combined ratio versus the $10.8 million gain on a 91.5 combined ratio for the same period last year. Casualty recorded an 80.5 combined ratio. Prior to the reserve changes noted above, the casualty segment would have produced a 93.7 combined ratio. The property segment improved nearly seven points to register a 61.8 combined ratio. The surety segment recorded a 94.5 combined ratio.
Net premiums earned were down 1% in the quarter, to $124.0 million. Consolidated revenue of $141.6 million was up 1%. Gross premiums written of $166.1 million were down 9% for the quarter. Through three months, segment performance included an increase in surety gross premiums of 7%, a rise in casualty writings of 1%, and a 37% reduction in property business.
During the first quarter, discipline ruled the day, said RLI Corp. President & CEO Jonathan E. Michael. The marketplace is continuing to soften in many coverage areas, which places additional value on underwriting selection to produce profits. Our underwriters excelled by delivering profitable results in all three business segments.
Our surety segment showed significant progress, reflecting both new business opportunities and the effect of revised underwriting controls. As expected, casualty business was relatively flat, yet continued to be profitable. Our property business is down due to marketplace conditions in several coverages as well as a reduced presence in the construction marketplace.
April 14, 2005