Allied World Assurance Company Holdings last night posted a second-quarter loss of $1.9 million compared to a profit of $96.4 million for the same period last year.The reinsurer said the quarterly net loss was due to $115 million of net realised investment losses “driven by the mark to market adjustments on the portfolio”.It said net income for the six months ended June 30 was $157.1 million, or $4.45 per diluted share, compared to net income of $314.5 million, or $8.41 per diluted share, for the first six months of 2012. The company reported operating income of $103.5 million for the second quarter compared to operating income of $87.3 million in 2012.President and CEO Scott Carmilani commented, "Allied World produced excellent underwriting results. We benefited from growth across all three segments, in part from newer product initiatives, and delivered a combined ratio of 82.8 percent for the second quarter of 2013."Despite the challenging investment environment, we continue to be well positioned to grow book value, and have done so at a rate of almost four percent during the first half of 2013."Gross premiums written were $765.2 million in the second quarter of 2013, an 18.3 percent increase compared to $646.9 million in the second quarter of 2012.For the six months ended June 30, 2013, gross premiums written totalled $1,602.3 million, a 20.7 percent increase compared to $1,327.8 million in the first six months of 2012.Net premiums written were $581.2 million in the second quarter of 2013, a 17.5 percent increase compared to $494.7 million in the second quarter of 2012.For the six months ended June 30, 2013, net premiums written totalled $1,276.3 million, a 17.8 percent increase compared to $1,083.7 million in the first six months of 2012.Net premiums earned in the second quarter of 2013 were $507.3 million, an 18 percent increase compared to $429.7 million in the second quarter of 2012.The combined ratio was 82.8 percent in the second quarter of 2013 compared to 85.1 percent in the second quarter of 2012.Allied World said the total return on the company's investment portfolio for the three months ended June 30 was a loss of 90 basis points compared to a gain of 60 basis points for the prior year quarter.“This was largely driven by losses in the US bond market, which, as measured by the Barclays Aggregate Bond Index, posted its third largest loss since 1981,” the company said.