Ace Group of Companies

The trend towards reducing the group’s reliance on the world’s biggest, but most volatile, insurance market, is set to continue

Ace Ltd increased its net income by an impressive 124.2% from US$1.0bn in 2005 to $2.3bn in 2006. In terms of the year-on-year improvement, this result must rank as one of the very best, if not the best, in the sector; even within the context of a year when a high number of insurers and reinsurers posted record financial performances due to the absence of significant catastrophe losses over the period. But with only a negligible increase (0.4%) to $11.6bn in Ace’s net earned premium income and a 6.3% increase in its operating expenses to $2.9bn, it is difficult to deny the contribution of the 17.4% reduction in the group’s claims incurred figures -from $8.6bn in 2005 to $7.1bn in 2006 - to the 558.0% improvement in the group’s underwriting profits to $1.6bn. And although investment income increased by 26.7% to $1.6bn in 2006, the contribution on the investment front was somewhat muted by net investment losses.