Bermuda-based insurer Catlin has posted a drop in earnings after rising interest rates cut the market value of its fixed-income portfolio.

Net income was $US118 million ($128 million) in the six months to June 30, down from $US184 million ($200 million) in the corresponding period last year.

The pre-tax result fell to $US145 million ($157 million) from $US231 million ($250 million).

Gross written premium (GWP) was up 10% to $US3.3 billion ($3.6 billion).

Catlin says the net underwriting contribution is little changed at $US441 million ($479 million), despite $US99 million ($107 million) in additional catastrophe claims, including losses from floods in Europe and Canada and US tornadoes.

“The share of our gross premium written, and more importantly net underwriting contribution, produced by the non-London/UK underwriting hubs continues to grow,” CEO Stephen Catlin said. “We see further promising opportunities ahead.”

London/UK GWP was $US1.47 billion ($1.6 billion) in the half. GWP from the international division, which includes Europe, Canada and the Asia-Pacific region, reached $US718 million ($779 million).

Reinsurance was the largest contributor to the underwriting result, followed by specialty/war and political risk. Energy/marine and aerospace were joint third.

Rates have increased across the portfolio and good underwriting margins continue in most classes, the company says.

Catlin’s combined ratio was 88.9% compared with 86.3% a year earlier.