FRANKFURT, Germany (AP) — Reinsurer Hannover Re reported much stronger fourth-quarter and full-year results yesterday as fewer disaster claims and better investment income improved its bottom line.The company, among the world’s top five reinsurers, reported a fourth-quarter profit of euro134.3 million (US$177.52 million) compared with a euro12.6 million loss the year before. That beat the euro114 million (US$150.7 million) that analysts polled by Dow Jones Newswires had predicted.

Reinsurance companies sell backup coverage to other insurers, spreading risk so the system can handle huge losses from major disasters.

Hannover Re’s net profit from continuing operations came to euro118.3 million (US$156.37 million) compared to a euro22.1 million loss a year earlier. The figure reflects its decision in December to sell its US-based specialty insurer Praetorian Financial Group Inc. to Australia’s QBE Insurance Group Ltd. for US$800 million.

Praetorian provides insurance on what the industry calls niche products, such as art collections, cell phones, jewelry businesses and even pets. The deal is expected to be complete by June.

The company’s fourth-quarter pretax earnings, which investors view as a better reflection of performance, rose to euro216.4 million (US$286.04 million) from euro27.8 million a year earlier.

For the year, the Hanover-based company — which has a Bermuda subsidiary — earned euro514.4 million (US$679.93 million) in 2006 compared with euro49.3 million (US$65.16 million) in 2005 when it was buffeted by numerous claims from the disastrous hurricane season that year. The figure beat expectations of euro495 million (US$654.29 million) that analysts polled by Dow Jones Newswires had predicted.

Gross premiums, however, remained steady at euro9.3 billion (US$12.29 billion), unchanged from a year earlier and below analysts’ estimates of euro10.6 billion (US$14.01 billion).

“Not only did we meet our targets, we surpassed them and recorded the highest group net income in our company’s history,” chief executive officer Wilhelm Zeller told reporters.

He said the company planned to offer a dividend of euro1.60 (US$2.11) a share for 2006 after it nixed any in 2005 because of the exposure to severe hurricanes then.

Hannover Re shares fell one percent to euro31.52 (US$41.66)in Frankfurt in a broadly lower market that followed on declines in the U.S. and Asia.On the Net:

http://www.hannover-re.com