Bermuda-based mutual insurer Oil Insurance Ltd. returned to profitability with a net income of $1.1 billion for 2009, including investment income, it was reported yesterday.

Oil had posted a $1.4 billion net loss and underwriting loss of $259 million in 2008, but bounced back with an underwriting income of $359 million last year.

"2009 was an extraordinary year for both financial results and operational accomplishments," Oil president and CEO Robert Stauffer said in a statement.

Oil's incurred losses decreased from $970 million in 2008 to $519 million in 2009, the company said.

Its premium volume rose from $719 million two years ago to $891 million last year.

Last year, the company approved a number of changes, including separating members into onshore and offshore pools and reducing the per-occurrence windstorm limit.

"Passage of the (changes) during the year demonstrates that Oil is committed to making changes to the mutual when appropriate," added Mr. Stauffer.

Oil's management reviewed the 2009 financial results at a shareholder meeting held in Bermuda last week.