Decrease in net income due to state mandated rate reductions and wind mitigation discounts, increased non-catastrophe losses and loss adjustment expenses incurred
Universal Insurance Holdings, a vertically integrated insurance holding company, has announced a net income of $7.6 million or $0.19 per diluted share for the second-quarter 2009, compared to $11.2 million or $0.28 per diluted share in the second quarter of 2008.
The company experienced a decrease in net income in the current period primarily as a result of the effects of state mandated rate reductions and wind mitigation discounts, increased non-catastrophe losses and loss adjustment expenses incurred, and decreased net premiums earned because of higher reinsurance costs, in the 2009 period.
However, the company’s income increased on a year-over-year basis in the 2009 second quarter. It was a result of positive investment portfolio performance, as net unrealised gains on investments totalled $5.7 million, net of tax, for the second quarter of 2009, while there were no net unrealised gains on investments for the same period of 2008.
In-force premiums were approximately $550.7 million as of June 30, 2009, versus $513.0 million at June 30, 2008, while direct premiums written were $156.8 million in the second quarter of 2009, compared to $142.9 million for the same period of 2008. In-force premiums at March 31, 2009, were approximately $534.3 million.