UPDATE 1-Insurer Beazley swings back to profit as claims abate
LONDON, July 20 (Reuters) - Lloyd's of London insurer Beazley swung to a first-half profit as claims fell back to more normal levels following a sharp catastrophe-induced increase a year ago.
Beazley said on Friday it made a pretax profit of $113 million in the six months to June, compared with a loss of $24.2 million in the 2011 period and forecasts for $100-$110 million.
The improvement partly reflected a 20 percent drop in net claims relative to the first half of 2011, when Beazley paid out $477 million to customers as earthquakes in Japan and New Zealand inflicted big losses on insurers worldwide.
Beazley also benefited from an average 3 percent rise in prices across its business, reflecting a steady turnaround in global insurance rates after four years of declines.
Insurance prices typically rise in the wake of major payouts as financially weaker players retrench, leaving those still in the market to charge more.
Beazley chief executive Andrew Horton said he expected prices to keep rising at the same pace in the second half.
"If there is an economic downturn it may put more pressure on those rate increases. We have an uncertain economic outlook in the next six months to one year," he told Reuters.
Horton also said Beazley, which last year expressed interest in buying rival Hardy Underwriting before it was snapped up by U.S. insurer CNA Financial, was still on the lookout for acquisitions, although no deals were imminent.
"There is nothing in mind at this point in time," he said.
Beazley shares were down 0.6 percent, underperforming a flat FTSE 250 share index. The stock is up 12 percent this year, lagging a 15 percent increase in the FTSE non-life insurance index
Beazley will pay an interim dividend of 2.7 pence, up 8 percent.
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