IPC Holdings boosted its profits by almost $60 million for the fourth quarter of 2007, but saw net income for the year decline.

The reinsurance company saw its net income rise to $167 million, or $2.48 per common share for the quarter, compared to $108.2 million, or $1.52 per share for the same period in 2006.

The company announced it had overestimated losses from a windstorm and floods earlier this year and that helped to boost results.

But full-year profits declined slightly from $394 million, or $5.54 per share in 2006 to $385.4 million, or $5.53 per share, for last year.

Business that was not renewed last year totalled $60.5 million, which was partly offset by new business written totalling $29.1 million during the same period. Excess of loss premium adjustments were $3.4 million less last year compared to 2006, while re-instatement premiums were $6.3 million more in 2007 in comparison to the previous year, mostly due to accruals resulting from anticipated claims from the Australian and UK floods in June and July and windstorm Kyrill.

IPC president and CEO Jim Bryce said: "We are gratified to report highly satisfactory results for 2007, despite an increase in frequency of losses compared to 2006.

"Our net income for the year represents the second highest in the history of the company, following the record year of 2006. Even though we have benefitted from a change in accounting policy, with unrealised gains from investments being recognised as income in 2007, our net operating income, which excludes all gains from investments, is also the second highest in our history.

"Accordingly, our net income available to common shareholders represents a return on average common equity of 20 percent. We were pleased that in the fourth quarter we were able to significantly reduce our estimates of ultimate loss for a number of the events that occurred earlier in 2007, due to receipt of updated information from our clients.

"We are also pleased to note our belief that problems arising from sub-prime or Alt-A mortgage-backed securities and related liability insurance issues should have little direct impact on IPC.

"January 1, 2008 renewals were generally in line with expectations, with rates falling by moderate levels. However, higher retentions in the US had a greater impact on premiums than originally anticipated."

IPC RE 4Q

REPORT CARD

Net income: $167 million compared to $108.2 million in 2006

Combined ratio: (minus) -28.2 percent compared to 33.3 percent in 2006

Gross premiums written: $15.2 million compared to $17.6 million in 2006