Mercury General’s Profit Lags Estimates

Mercury General Corp., a major automobile insurer in California, reported that its third-quarter operating earnings rose 3% to $40.6 million, or 73 cents a diluted share, up from 71 cents in the year-ago quarter but well short of analysts’ estimates of 82 cents. After capital gains and losses, net income rose to $41.4 million or 75 cents a share from $40.8 million, 74 cents, a year ago. Los Angeles-based Mercury General said net premiums written increased 1% to $293 million in the quarter from $289.3 million last year. Third-quarter policyholder count rose at an annualized rate of 12.8%. The company said the disparity between policy count growth and premiums written was due to a 7% rate reduction, in April, and a state-mandated discount on policy renewals. Mercury’s stock fell $2 to close at $43.68 on the New York Stock Exchange.