Ace has reported a $US973 million ($938 million) pre-tax profit for the first quarter, a 289% increase on the same period last year.

The huge jump is due largely to a benign loss period, compared with the first quarter last year, which was marred by $US489 million ($471 million) in catastrophe losses.

Chairman and CEO Evan Greenberg says only $US19 million ($18 million) of cat losses buoyed this year’s first quarter.

“We and much of the industry benefitted from relatively light catastrophe losses in the quarter, particularly compared to the prior year,” he said.

But there was also some improvement in underlying performance, with operating income excluding catastrophes up 2% and net written premiums up 3.7%.

Ace posted an 89% property and casualty combined operating ratio, compared with 105.2% for the same period last year, with Mr Greenberg describing the underwriting results as “simply excellent”.

The company reported rate increases in line with or marginally better than it had expected, with US rates up by an average 3.6%.

“This was the strongest quarter yet for rate increases, which were more broad-based,” Mr Greenberg said. “We benefitted from improved pricing in many of our property-related classes and modestly improved pricing in certain casualty classes.”

He signalled more rate rises were on the horizon, adding that the premium growth rate is “expected to accelerate as the year progresses”.

The strong performance with positive first-quarter prior period reserve development and lower-than-budgeted catastrophe losses led the company to issue improved profit guidance for the full year.