Universal Insurance Holdings reported higher third-quarter revenue and earnings as its net combined ratio improved to 91%, while direct premiums written declined in Florida, revealing a split in regional performance.
For the quarter ended Sept. 30, the insurer recorded revenue of $439.319 million, up from $400.981 million a year earlier. Net income available to common stockholders climbed to $52.506 million from $39.827 million.
Adjusted diluted earnings per share reached $1.93, compared with $1.36, while diluted GAAP earnings per share rose to $1.80 from $1.38. The company defines adjusted EPS as a non-GAAP measure that removes the effects of net realized and unrealized investment gains and losses.
Universal had 953,611 policies in force at quarter-end, 7.9% more than 883,888 a year earlier. Direct premiums written increased 2.7% to $608.878 million. Florida accounted for $414.404 million of that total, down 3.3%, while premiums elsewhere rose 18.5% to $194.474 million. Growth outside Florida more than offset the decline in the state. Net premiums earned advanced 12.1% to $403.196 million.
The net combined ratio improved by 5.4 percentage points to 91.0%, compared with 96.4% a year before. A 5.6-point drop in the net loss ratio brought it to 64.6%; the net expense ratio rose 0.2 points to 26.4%. The two components together totaled the 91.0% combined ratio; the decline in the loss ratio outweighed the increase in the expense ratio.
The ceded premium ratio fell to 27.6% from 32.7%. Universal linked much of the decline to a reinsurance program that took effect June 1.
CEO Stephen J. Donaghy pointed to continued improvement in loss performance and cited policy growth as evidence of solid new-business trends. Universal's insurance subsidiaries offer residential coverage for homeowners, renters and condominium unit owners.
