Hanover Insurance Group (THG) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $13.50 million in the quarter, against a net profit of $77.60 million in the last year period.
Revenue during the quarter grew 4.18 percent to $1,255 million from $1,204.70 million in the previous year period. Net premium earned for the quarter went up marginally by 2.86 percent or $32.50 million to $1,170.40 million.
Total expenses move up
Benefits, losses and expenses for the quarter were at $1,287.80 million, or 110.03 percent of premium earned from $1,105.30 million or 97.14 percent of premium earned in the last year period. Operating loss for the quarter was $32.80 million, compared with an operating income of $99.40 million in the previous year period.
Net investment income was at $74.20 million for the quarter, up 6 percent or $4.20 million from year-ago period. Meanwhile, income from fees and commission for the quarter declined 6.85 percent or $0.50 million to $6.80 million. The company has recorded a gain on investments of $3.60 million in the quarter compared with a loss of $10.50 million for the previous year period.
"The fundamentals of our business are very strong, and we are pleased with the underlying results in the quarter and for the full year," said Joseph M. Zubretsky, president and chief executive officer at The Hanover. "The reserve review we conducted during the quarter confirmed that the reserve development was related to business issues we believe we have successfully addressed in the recent past and gave us even greater confidence in the composition of our existing business portfolio. Our underlying performance during the quarter and full year, including the underlying quality of growth, strong retention and underwriting and pricing discipline, reaffirms our confidence in the foundation on which we are building our company. We look forward to sharing our go-forward strategy at our Investor Day later this month, where we will discuss our plan to deliver superior value for our partners, customers and shareholders."
Liabilities outpace assets growth
Total assets increased 3.19 percent or $439.20 million to $14,220.40 million on Dec. 31, 2016. On the other hand, total liabilities were at $11,362.90 million as on Dec. 31, 2016, up 3.90 percent or $426.10 million from year-ago.
Return on equity was negative at 0.47 percent in the quarter against a positive 2.73 percent in the last year period.
Investments move up
Investments stood at $8,449.50 million as on Dec. 31, 2016, up 6.24 percent or $496.10 million from year-ago. Meanwhile, yield on investments was almost stable at 0.88 percent in the quarter, when compared with the last year period.
Net premiums and other receivables increased 3.33 percent or $46.40 million over the year to $1,438.10 million on Dec. 31, 2016. Meanwhile, reinsurance recoverables moved down 0.88 percent or $23.20 million over the year to $2,611.80 million on Dec. 31, 2016.
Total debt was at $786.40 million as on Dec. 31, 2016, down 2.08 percent or $16.70 million from year-ago. Shareholders equity was almost stable over the past one year at $2,857.50 million on Dec. 31, 2016. As a result, debt to equity ratio went down 1 basis points to 0.28 percent in the quarter from 0.28 percent in the last year period.
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