FM Global announces ’06 profit of US$737 milion

FM Global reported a profit of US$737 million [approximately Cdn$864 million] in 2006, an increase from 2005s profit of US$635 million [approximately Cdn$744 million].
According to an FM Global press release, the companys combined ratio was 75.3% and the client retention rate was 93% for the year 2006.
Among its 2006 highlights, company officials listed the offering of a new coverage option, Time Element Select, which allows clients to maximize their business interruption recovery after a loss has occurred.
Previously, explains the company statement, clients were required to make a choice at policy inception that defined whether the business interruption part of the loss would be based on a production or sales basis.
Given our strong capital base, operating record and mutual ownership, we have continued to offer our products and services at pre-Hurricane Katrina levels, unlike most of our competitors, while increasing surplus, maintaining our strong financial ratings and retaining clients, Shivan Subramaniam, FM Global chairman and chief executive officer, said in a statement.
Looking towards 2007, Subramaniam said that the company is operating on a business model based on risk assessment and risk improvement.
Our challenge is to understand the rapidly changing risk profile of our clients as they adapt to new markets, lower-cost manufacturing environments, single-source suppliers and an increasingly global workforce, he said.