DOW JONES NEWSWIRES
Assurant Inc.'s (AIZ) second-quarter earnings rose 2% as the
insurance company benefited from a big gain from a legal settlement
that masked weakness at its health and specialty property
units.
"We are taking decisive actions throughout Assurant to improve
performance, reduce expenses, enhance revenues and best position
the company for the long term," said Robert B. Pollock, president
and chief executive. "Clearly, we are disappointed with the
operating results at Assurant Health and are taking steps to
correct the situation."
Assurant is one of the few companies that benefited from rising
mortgage defaults because its specialty-property unit collects
premiums from banks on homes whose owners have fallen behind on
coverage, but it suffered with the rest of the industry from the
last year's challenges from the economy and severe weather.
However, the company's capital position has remained strong, as
indicated by its dividend increase earlier this year.
The company, which insures a range of items from credit cards to
trailer parks, reported earnings of $193.3 million, or $1.63 a
share, compared with $190 million, or $1.59 a share, a year
earlier. The latest results included an $85 million gain from a
legal settlement.
Operating earnings, which exclude net realized investment gains
and losses, fell to 84 cents a share from $1.55. The latest figure
included a $6.4 million restructuring charge.
Revenue rose 1.1% to $2.27 billion.
Analysts expected per-share operating earnings of $1.21 and
revenue of $2.16 billion, according to a poll by Thomson
Reuters.
Net premiums earned fell 6%, with declines hitting all the
company's businesses. Net investment income fell 13%.
Profit in the largest segment, specialty property, fell 30% as
the business suffered from servicer consolidation, fewer policies
and higher catastrophe-reinsurance costs, while the health unit
swung to a loss on rising claims.
Assurant's shares were up 0.2% at $24.95 in after-hours trading.
The stock price has doubled since late November but is still down
more than 60% from a year ago.
-By Jay Miller, Dow Jones Newswires; 212-416-2355;
jay.miller@dowjones.com