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CONTACT: David Foy
WHITE MOUNTAINS REPORTS
ADJUSTED BOOK VALUE PER SHARE OF $441
HAMILTON, Bermuda (February 4, 2011) White Mountains Insurance Group, Ltd. reported an adjusted book value per share of $441 at December 31, 2010, an increase of 3% for the fourth quarter of 2010 and 6% for the year, including dividends.
Ray Barrette, Chairman and CEO, commented, We had an OK year. Investment returns were decent given the conservative positioning of our portfolio. OneBeacons overall underwriting results were dragged down by the businesses it recently exited, but the specialty results were good. White Mountains Re had a strong finish to the year and a solid year overall, quite a comeback given the Chile earthquake losses early in the year. Esurance grew nicely at acceptable loss ratios, as both policyholder conversion and retention improved. Our share repurchase program is working well and added $7 to adjusted book value per share during the year. Our balance sheet and capital position are strong. I expect continued soft insurance markets but we are well positioned to take advantage of opportunities as they arise.
Adjusted comprehensive income was $81 million in the fourth quarter of 2010 and $141 million in the year, compared to $91 million in the fourth quarter of 2009 and $560 million last year. Net income was $73 million in the fourth quarter of 2010 and $87 million in the year, compared to $100 million in the fourth quarter of 2009 and $470 million last year.
OneBeacons book value per share increased 3% for the fourth quarter of 2010 and 9% for the year, including dividends. The GAAP combined ratio for the fourth quarter of 2010 was 97% compared to 93% for the fourth quarter of last year, while the GAAP combined ratio for 2010 was 101% compared to 94% for last year. OneBeacon has recently exited its personal lines business, which was sold in July 2010, and its non-specialty commercial lines business, which has been in runoff following the sale of the renewal rights to the business in December 2009. The increase in the combined ratio for the quarter was primarily due to an increase in the expense ratio, reflecting higher acquisition costs in its specialty businesses as compared to the exited businesses and other underwriting expenses that have not decreased proportionately with the reduction in earned premium associated with the exited businesses. The current accident year loss ratio for the quarter was unchanged, despite higher loss ratios in both specialty and run-off, reflecting the shift in mix toward the better performing specialty business. The increase in the combined ratio for the year was primarily due to large loss activity and catastrophe losses experienced earlier in the year, particularly in the exited businesses. OneBeacons combined ratio benefited from favorable loss reserve development of 5 points and 3 points for the fourth quarter and full year of 2010, compared to 6 points and 4 points for the fourth quarter and full year of 2009.
Mike Miller, CEO of OneBeacon, said, We are pleased to finish the year with a 9% growth in book value per share. Solid investment results offset poor underwriting results. Our overall 101% combined ratio for the year was driven by adverse results in businesses we recently exited. Our specialty results were solid, at a 94% combined ratio. After returning significant capital to shareholders and reducing our financial leverage, we emerged as a well-capitalized and focused specialty company.
The following information was filed by White Mountains Insurance Group Ltd (WTM) on Friday, February 4, 2011 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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