Hanover Posts $20.8M Profit In Q2

Bouncing back from losses it saw last year, mainly related to severe weather, The Hanover Insurance Group in Worcester reported net income of $20.8 million, or 46 cents per diluted share (EPS), for the second quarter of 2012. That compares to a loss of $32.2 million, of 71 cents per share, reported during the same period last year.

Net premiums written were up nearly 47 percent over last year, coming in at $1.2 billion. Chaucer Holdings, which Hanover acquired last year, produced $330 million of that total. A 13-percent growth in commercial lines is also credited for the improvement.

Segment income after tax was $10 million, or 22 cents EPS, in the second quarter of this year, compared to a segment loss of $38.4 million, or 85 cents per share, last year.

Commercial lines pre-tax segment losses were $9.4 million in the second quarter of this year, compared to a loss of $25.3 million in the second quarter of 2011.

The personal lines segment also saw an improvement in the quarter, thanks to fewer weather-related losses, with an income of $12.3 million, compared to a loss of $22.8 million last year. Investment income was $68.5 million.

"Our diversified business delivered profitable results in the quarter, despite the higher-than-expected catastrophe losses and unfavorable loss development in certain lines," said CEO Frederick H. Eppinger. "We are addressing the unfavorable development in our U.S. surety and automobile liability lines of business. However, we continue to see positive trends in our domestic businesses. Most importantly, we achieved even greater price increases while maintaining strong retention levels."

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