Liberty Mutual eked out $17 million in net income for 2017, after making more than $1 billion the year before. Record catastrophes, adverse development in its commercial automobile business and a charge related to the Trump tax cuts were to blame for the $989 million drop.

“While the results in 2017 did not meet our expectations, we are encouraged by signs of market firming across each of our businesses,” Liberty Mutual Chairman and CEO David Long said in prepared remarks.

Long also noted that net written premium and income for the fourth quarter increased even with catastrophe loss and tax cut charge challenges. Better investment results helped, Long said.

Net income for the 2017 fourth quarter landed at $205 million, up $62 million from the same period a year ago. Net written premium for Q4 was close to $8.9 billion, up $716 million over the same period in 2016. Consolidated net income for the quarter and year were $205 million and $19 million, respectively, with non-controlling interest factored in.

Liberty Mutual’s combined ratio for 2017 was 105.6, up 7.3 points from the previous year.

Other result highlights:

• Acquisition and integration costs relating to Liberty Mutual’s $3 billion acquisition of specialty lines insurer Ironshore Inc. from Fosun International were $56 million for 2017.

• Restructuring costs for the 2017 fourth quarter were $44 million, down $2 million from the same period in 2016. For all of 2017, they were at nearly $60 million, up $13 million from 2016.

• In January, Liberty Mutual said it would sell its life insurance division—Liberty Assurance Company of Boston—to Lincoln Financial Group for about $3.3 billion, and the deal will close in the 2018 second quarter. Those results are presented in Liberty Mutual’s financials as discontinued operations. For 2017, discontinued operations were $213 million, up $95 million from 2016.

Liberty Mutual is also restructuring its P/C operations. It realigned its consumer and commercial insurance businesses into two P/C divisions: Global Risk Solutions and Global Retail Markets.

Source: Liberty Mutual