Hanover Posts Profit In Q3

In its third quarter, the Hanover Insurance Group Inc. continued to bounce back from a rough 2011 caused mainly by severe weather. The Worcester-based insurance company reported profit of $40.4 million, or 89 cents per diluted share for the third quarter of 2012. That's compared to a loss of $10 million, or 22 cents per diluted share, in the same period last year.

Net premiums written were up 6.6 percent over the third quarter of 2011, rising to $1.1 billion, mostly driven by growth in commercial lines, Hanover reported.

Commercial lines had a pre-tax income of $8.1 million, compared to a $22.5-million loss in the third quarter of 2011. Personal lines had a pre-tax income of $14.7 million compared to a loss of $5 million.

Segment income after tax was $32.5 million, or 72 cents per share, an improvement over the loss of $18.8 million, or 41 cents per share last year. The pre-tax impact of catastrophes was $51.9 million, compared to $99.6 million last year.

Chaucer Holdings, which Hanover acquired last year, accounted for $42 million of Hanover's third quarter income, compared to $19.9 million the prior year.

"We continue to see strong rate momentum, as well as targeted new business opportunities that improve our portfolio," said CEO Frederick Eppinger. "Overall, commercial and personal lines pricing increased approximately 8 percent and 7 percent in the quarter, respectively. Our pricing and mix management strategy is now driving underlying margin improvement in property lines, where we experienced price increases reaching 10 percent."

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