Assurant Posts Quarterly Profit Gain After Settlement (Update1)

By Jamie McGee
Bloomberg News
July 29, 2009


July 29 (Bloomberg) -- Assurant Inc., the provider of homeowner and health insurance, said second-quarter profit climbed 1.7 percent after gains from a legal settlement with Willis Group Holdings Inc.

Second-quarter net income rose to $193.3 million, or $1.63 a share, from $190 million, or $1.59, in the year-earlier period, the New-York based insurer said today in a statement. Operating income, which excludes some investment results, was 84 cents a share, missing the $1.20 estimate of 10 analysts surveyed by Bloomberg.

Assurant announced the settlement in June after its American Reliable Insurance unit filed a court claim in September 2007 and said a "conspiracy between a former Willis Limited employee" and one of the insurer's underwriters cheated the company, according to a regulatory filing. The legal settlement contributed $85 million after tax to Assurant's earnings.

Assurant slipped 88 cents to $25 in the New York Stock Exchange today before announcing earnings. Assurant has fallen about 62 percent in the past year compared with the 24 percent drop of the 77-company Bloomberg World Insurance Index.

Operating income fell 47 percent to $99.3 million on a $10.3 million loss in Assurant's health insurance unit and a profit decline in its specialty property business.

"We are disappointed with the operating results at Assurant Health and are taking steps to correct the situation," Assurant Chief Executive Officer Robert Pollock said in the statement.

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