(Reuters) – Insurer W R Berkley reported a rise in fourth-quarter profit on Wednesday, helped by higher premiums and a surge in investment income.
Heightened expectations of a soft landing have boosted sentiment among businesses and reduced uncertainty, encouraging them to ramp up their spending on insurance policies.
The 57-year-old W R Berkley operates two segments – insurance and reinsurance & monoline excess.
The insurance unit primarily caters to commercial clients and is the bigger business. Reinsurance & monoline excess provides insurance to other insurers to help them manage their risk.
W R Berkley’s net premiums written grew 12% from a year earlier to $2.72 billion. Net investment income surged 35.5% to hit a quarterly record of $313.3 million, driven by a 52.9% increase in its core portfolio.
Insurers use their cash to buy a portfolio of assets, chiefly safe-haven ones such as U.S. Treasuries and other high-grade corporate bonds.
Multiple rate hikes by the U.S. Federal Reserve have helped insurers earn higher interest from such investments.
For the three months ended Dec. 31, net income to common stockholders rose to $397.34 million, or $1.47 per share, from $382.22 million, or $1.37 per share.
Shares of the company were broadly flat after results. Stock fell marginally last year.
(Reporting by Manya Saini and Niket Nishant in Bengaluru; Editing by Krishna Chandra Eluri)