Swiss Re has reported a strong net income for 2007 of CHF 4.2 billion ($4.36 billion) - nearly as good as its record 2006 return.

CEO Jacques Aigrain says property and casualty results were the best yet achieved, with premium income increasing 7.3% to CHF 31.7 billion ($32.88 billion).

Swiss Re's fourth-quarter result was impacted by "isolated yet significant" mark-to-market losses from credit underwriting activities.

Property and casualty showed a combined ratio of 90.2%, while earned premiums grew 2% to CHF 19 billion ($19.7 billion).

Mr Aigrain says the main drivers were a strong performance particularly in the property and specialty lines of business, as well as the first full-year inclusion of the business Swiss Re acquired from GE Insurance Solutions.

"These results reflect the quality of Swiss Re's insurance underwriting despite the increased frequency of weather events in 2007," he said.

Swiss Re expects property and casualty market conditions to remain challenging, at least in the short term. "The January renewal season confirmed this trend, as almost all sectors showed signs of softening in these conditions."

Mr Aigrain says Swiss Re won't pursue volume growth but will continue to apply strict underwriting discipline.