Canadian insurance-focused investor Fairfax Financial Holdings has reported a drop in third-quarter net income to $US106.2 million ($146.8 million) from $US476.9 million ($659 million).

The decline was due to weaker investment gains, which fell to $US41.2 million ($57 million) from $US1.1 billion ($1.52 billion) in the corresponding period last year.

Gross written premium increased to $US3.76 billion ($5.25 billion) from $US3.48 billion ($4.86 billion). The business made an underwriting profit of $US74.2 million ($102.6 million), up from a loss of $US833 million ($1.15 billion) last year.

The combined operating ratio improved to 97.6% from 130.2%.