Ace has reported a 2% drop in first-quarter net income following lower investment earnings, while premium growth helped improve its operating result.

Net income for the three months to March 31 fell to $US953 million ($925 million) from $US973 million ($944 million) in the corresponding period last year.

Operating income after tax grew to $US746 million ($918 million) from $US701 million ($680 million).

The property and casualty combined ratio for the quarter was 88.2%, down from 89.2%, as current accident year underwriting income benefitted from improved margin and growth in the US and international businesses.

Total gross written premium grew to $US4.96 billion ($4.81 billion) from $US4.79 billion ($4.65 billion), Zurich-based Ace says.

“We are taking full advantage of the improved commercial property and casualty pricing environment in the US and our strong presence in areas of the world where economic fundamentals are superior, such as Asia and Latin America,” Chairman and CEO Evan Greenberg said.

Ace completed its acquisition of Mexican surety company Fianzas Monterrey and expects to close the purchase of ABA Seguros, Mexico’s fourth-largest personal lines company, in the next few weeks.

The group increased its full-year guidance for after-tax operating income – to $US7.10-7.50 ($6.89-7.28) – and says it is “optimistic about growth prospects for the balance of the year”.