(Bloomberg) ? Catlin Group Ltd., a Bermuda-based insurer and reinsurer, said first-half profit increased 32 percent as premium prices climbed after last year?s record US hurricanes. The stock jumped as much as 7.5 percent.

Net income rose to $147.3 million, or 92 cents a share, from $111.2 million, or 72 cents a share, in the year-earlier period, the company said last week in a statement. Gross premiums advanced 16 percent to $903.1 million. Pretax profit excluding foreign exchange effects fell 5.9 percent to $139.1 million, Catlin said.

Catlin maintained ?disciplined? underwriting, cutting its coverage of catastrophe risks by a third. Premium rates have climbed since 2005, when the costliest hurricane season on record battered oil rigs, ships and property along the US Gulf Coast and caused more than $65 billion of damage, according to Fitch Ratings.

?These are a good set of results and they have a positive outlook,? said Gerald Farr, an analyst at Seymour Pierce in London, who has an ?outperform? rating on the stock. ?Even if we see a heavy storm season they won?t have to pay out as much as last year.?

The stock surged as much as 35.5 pence to 509.5 pence, its biggest gain since Catlin?s initial public offering in April 2004. Shares of Catlin traded up or 3.2 percent to 489 pence as of 9.17 a.m. in London, valuing the company at 800.2 million pounds. The shares have slipped 2.5 percent this year through yesterday.

?Catlin is looking ahead to the remainder of 2006 and into 2007 with optimism,? the company said in the statement. ?Market conditions are currently good, and we expect that rates will continue to firm for many classes of business.?

Premium rates rose by 12 percent overall, the company said. Catlin?s combined ratio, or claims and expenses as a percentage of premiums increased to 84.7 percent, from 82.3 percent.

The company raised its interim dividend to 6 pence a share, from 5.4 pence a share.

Catlin took a loss of $19 million in the first half for the failure of an ArabSat communications satellite insured by its UK unit.