Bermuda biggest company Ace Ltd. last night reported a 43-percent surge in first-quarter earnings to $701 million.

The insurer and reinsurer enjoyed improvements across the board as net investment income, combined ratio and underwriting income results all outshone those for the same period last year.

However, the company's global reinsurance segment reported a 21 percent decrease in net premiums written, although the insurance sector registered a 2 percent increase.

Broken down, net income amounted to $2.10 per share, compared to $1.46 per share for the first three months of 2006, when net income totalled $489m.

Income excluding net realised gains was $663m, or $1.98 per share, compared with $477m, or $1.43 per share, for the same quarter of last year.

Last year's first-quarter results were impacted by an $80m pretax charge, which Ace agreed to pay as part of a regulatory settlement with three states — New York, Connecticut and Illinois — to settle charges of bid-rigging.

The combined ratio, a measure of profitability used in the industry, was 87.1 percent for the first quarter, an improvement on last year's figure of 90.6 percent. Annualised return on average equity based on the first quarter was 18.5 percent.

Net investment income for the quarter soared 22 percent to $451m, while shareholders' equity rose increased 5 percent from the end of 2006, to $14.9 billion.

Evan Greenberg, Ace's president and chief executive officer, said: "Ace had a very strong start to the year. We produced record net and operating income for the first quarter, and our tangible book value per share grew at a 22 percent annual pace.

"The quality of earnings was excellent, with strong contributions from both underwriting and investment income. Net written premium growth was in line with market conditions.

"Globally, we are maintaining underwriting discipline and avoiding business where prices and terms don't meet our standards while driving for growth in those areas where we see opportunity."

Life insurance and reinsurance proved a growth area, with net premiums written increasing 44 percent over the prior year quarter.

Book value per share as of March 31, 2007 increased $1.84 from the end of last year to $43.87. And invested assets increased by $1.8 billion, or 5 percent, during the first quarter to $38.9 billion.