NEW YORK (Bloomberg) — Ace Ltd., the Bermuda-based business insurer, said its high-yield bond and equity investments have gained in value after declines in the first quarter.

"These markets have recovered significantly in the first few weeks of April," Chief Financial Officer Philip Bancroft said today in a conference call with analysts.

Ace reported net realised investment losses of $348 million in the first quarter, which compared with gains of $38 million in the year-earlier period and dragged down net income 46 percent. The company also reported unrealised losses and said stock holdings declined by about $220 million and high-yield bonds by $110 million in the quarter.

Insurers, which make money by investing premiums before paying out claims, struggled to produce returns in the first quarter as stocks fell and the US housing slump weighed on the value of debt securities. At least 13 of the biggest insurance companies have reported a profit decline or loss in the first three months of the year.

Ace gained $1.44, or 2.5 percent, to $59.79 yesterday morning in New York Stock Exchange composite trading. The company has declined about 3.2 percent this year.