ACE Ltd. last night announced 2006 profits of $2.3 billion and fourth-quarter results which far outstripped experts’ expectations.

Year on year, the business insurer’s fourth-quarter net income nearly tripled to $665 million, or $1.99 per share, compared to 2005’s $236 million, or 69 cents per share.

Evan Greenberg, ACE’s president and chief executive officer, said: “The quarter was an excellent finish to an outstanding year.”

In 2005, Bermuda-based ACE was hit hard by Gulf Coast storm claims, especially those relating to Wilma, which cost the company 94 cents a share.

Analysts were expecting fourth-quarter returns of $1.74 per share — that was the average estimate of 22 analysts in a Thomson Financial survey. ACE achieved 25 cents better.

Net premiums written climbed 9 percent, helped by a “particularly large” risk management account that the insurer won during the quarter. Excluding that, net written premiums rose 4 percent.

The $2.3 billion 2006 profit figure amounted to $6.91 per share and more than doubled 2005’s figure of $1 billion, or $3.31 per share.

Operating income, often the figure used to measure performance in the industry, was $2.351 billion for 2006, or $7.05 per share, a new record for the company. That compared with $955 million, or $3.06 per share, for 2005.

Claim costs fell for the industry as no hurricanes made landfall in the US in 2006, allowing Bermuda’s catastrophe coverage specialists to post a year of bumper profits. And consequently rates are now falling.

But ACE has a strong line of catastrophe business, in which prices have reportedly remained firmer than other lines.

Mr. Greenberg was upbeat about the company’s future.

“Book value grew by over 20 percent and our return on equity exceeded 18 percent,” Mr. Greenberg said. “While market conditions continue to soften and we remain firmly committed to underwriting discipline, we are a large organisation with a broad capability and tremendous geographic reach.

“This creates opportunity for growth without compromising our underwriting standards. We are well positioned to continue our growth in book value for the foreseeable future.”

The combined ratio for the year was 88.1 percent, compared with 99.5 percent in 2005. Return on average equity for the year was 18.5 percent.

Ace announced its results in a statement after the markets closed last night. Earlier in the day, Paul Newsome, an analyst at A.G. Edwards & Sons Inc. in St. Louis, told Bloomberg News he had put a “buy” rating on ACE Ltd.’s stock. “The hurricanes had a big impact on their earnings, and this year there was no material impact from unusual weather,” Mr. Newsome said.

ACE’s shares rose 30 cents, or 0.5 percent, to $58.60 in New York Stock Exchange composite trading.