BF&M Limited announced net income of $4.4 million for the three-month period that ended March 31 yesterday.The domestic insurance sector has been active this week. On Monday Argus announced earnings of $12.6 million for the year ended March 31, compared to $1.7 million in the prior year.The BF&M results mean an annualised return on shareholders’ equity of eight percent. Shareholders’ net income for the same three month period of 2012 was $4.5 million.A press release announcing the results quoted BF&M President and chief executive officer John Wight stating that: “Financial results for the first three months of 2013 were comparable with the corresponding period in 2012. BF& M’s insurance operations are based in Bermuda, Cayman, and Barbados, and each of these country’s economies continue to face ongoing challenges that impact our individual, commercial, and group customers.”He said the group’s earnings for the past several years are because of “disciplined underwriting and investment of policyholder and company funds, while building new insurance administration platforms to better service our businesses.”“When growth in the economies of these countries improve, the Company will be well positioned to continue and enhance its strong performance.”Mr Wight added that the company’s balance sheet “continues to be very strong.“Equity attributable to shareholders at March 31, 2013 was $211.2 million. Assets totalled $1.1 billion of which $107.1 million was held in cash and short term deposits.“Based on the company’s strong balance sheet, the Board of Directors maintained the dividend of 20 cents per share for shareholders of record at 28th June 2013.”The press release stated that AM Best’s financial strength ratings for BF& M’s two principal operating subsidiaries, BF& M General Insurance Company Limited and BF&M Life Insurance Company Limited are A (Excellent).It said: “There is no insurance company in Bermuda writing domestic insurance business with ratings this strong. AM Best cited BF& M’s ‘consistent positive net income, steady premium growth, high level of capital, and strong market share’.”The press release also said that when comparing the results of 2013 with 2012, it is important to note that BF&M Limited acquired Island Heritage Holdings, Ltd, a leading Caribbean company with extensive insurance operations, on 30 March 2012, and thus the 2012 Q1 BF&M earnings do not include the Q1 results of this company.Argus earlier in the week also expressed pleasure with their results, saying their earnings “represent a year of continued recovery for the Argus Group and were achieved against a backdrop of prolonged economic recession, both locally and globally.”However, last week Freisenbruch-Meyer Insurance Services (FMIS) announced they would no longer offer health insurance. William Madeiros, FMIS general manager, said the decision that it had been made “due to what is undoubtedly the most challenging health insurance renewal period in recent history.”FMIS negotiated a ‘co-operative venture’ with BF&M, so their clients could move with no lapse in coverage.BF&M also reported that gross premiums written for the period were $78.4 million, an increase of 38 percent over 2012. Investment income for Q1 reflected a $3.7 million decrease in the value of investments for the period as the marginal increase in interest rates decreased the fair value of the company’s extensive fixed income portfolio. Offsetting this was a $3.5 million decrease in the value of policyholder benefits as a result of the company’s disciplined asset liability matching policy which limits volatility of reported earnings as a result of interest rate swings in either direction. Commission and other income increased 68 percent to $10.7 million.Short term claims and adjustment expenses decreased by two percent to $6.9 million and life and health policy benefits decreased by three percent to $18.5 million.Operating expenses increased 35 percent to $15.9 million.