Boosted by an increase in its life insurance and property and casualty businesses, USF&G; Corp.'s operating earnings jumped 17.5 percent in the third quarter and 35.6 percent for the first nine months of the year, the company said yesterday.
Operating earnings grew to $47 million, or 35 cents a share, for the quarter, and $131 million, or 99 cents a share, for the nine-month period.
"It was another good quarter for us in line with analyst expectations," said Dan Hale, the Baltimore-based insurer's chief financial officer. "It looks like a very good year."
USF&G;'s stock closed at $18.875, up 37 cents.
The company earned $49 million in the quarter, down from $75 million a year ago, but those earnings were boosted by $36 million in deferred tax benefits.
Two areas drove USF&G;'s performance: property and casualty, and life products.
Written premiums in property and casualty increased 9.5 percent in a market where pricing has been intensely competitive. Property and casualty earned $61 million in the quarter, up 7 percent from a year ago, and $176 million for the nine months, up 21.2 percent.
"That is one of the reasons we feel good about our overall underwriting performance," Mr. Hale said. "It is the old supply-and-demand situation, too much surplus chasing too few deals."
The life insurance business earned $7 million in the quarter and $19 million for the nine-month period, compared with $4 million and $12 million a year ago.
"Our life insurance operation continued to pick up momentum in both sales and profitability," Norman P. Blake Jr., chairman and chief executive, said. "This is a direct result of cost restructuring and the development of new higher-margin products and distribution channels."
Earnings were dampened by USF&G;'s noninsurance businesses, which lost $21 million in the quarter, compared with $22 million a year ago.