Financially troubled Tower Group International’s woes aren’t over yet. After announcing the
resignation of its president and CEO this week, the property/casualty insurer posted a $344.1mn loss in the third quarter of 2013 Wednesday during a disclosure of its figures for the first nine months of last year.
Revenue for the quarter also fell 6.75% to $422.9mn.
To put those figures in perspective, Tower Group enjoyed a $25.9mn net income during the same period in 2012.
The insurer attributed the loss to “lower earned premiums and investment income offset by increased ceding commissions and net realized investment gains,” primarily in its North American business.
“Adverse loss reserve charges of $142.7mn in the third quarter of 2013 exceeded the previous estimate of $75mn to $105mn,” the insurer said in a statement.
Tower Group also disclosed a drop in net written premiums of 43% and in net investment income of 18.5% during the third quarter. Nine-month combined ratio for the group was 142.7%, as compared to 101.5% in 2012.
The struggling insurer announced in January it would be bought by reinsurer ACP Re Ltd. for $172mn. The deal is expected to close this summer, by which time former board member William W. Fox, Jr. will assume the duties of president and CEO of Tower Group.
Following Lee’s tenure as Tower Group’s chairman of the board is Jan R. Van Gorder, a member of Tower’s audit committee compensation and former CEO of Erie Insurance Group.
