Bermuda-based insurer Max Capital Group Ltd. swung to profit in the third quarter, as it reaped the benefits of an expanding underwriting platform and a lack of hurricanes.

Net income for the July through September period was $95.3 million, or $1.64 per share, Max said yesterday, compared to a net loss of $163.2 million, or $2.89 per share for the same period in 2008.

The company has expanded significantly over the past three years establishing its Max at Lloyds platform in London and widening the reach of its US specialty business, to back up its insurance and reinsurance operations in Bermuda and Dublin.

The expansion was reflected in a near $60 million, or 29 percent, increase in gross premiums written to $265.9 million.

A breakdown of the numbers showed that the vast majority of the company's business is still written out of its Bermuda/Dublin operation, which garnered $175.2 million in gross premiums.

Book value per diluted share increased by 12.8 percent during the quarter to $26.54 at September 30, 2009, as the market value of investment assets climbed. Shareholders' equity was $1.55 billion at September 30, 2009.

"Our strong third-quarter results reflect positive underwriting performance from all segments and a significant increase in book value per share," Marston (Marty) Becker, Max's chairman and chief executive officer, said.

"Max's underwriting results have benefited from the continued build out of our global platforms in both the US and at Lloyd's, and a benign Atlantic hurricane season.

"An improvement in the investment market has lifted the fair value of our investment portfolio, contributing to the substantial book value increase for the quarter."

Net operating income for the third quarter was $53.7 million, or $0.92 per share, compared to a net operating loss of $144.7 million, or $2.57 per share in the prior-year period.

Annualised net operating return on average shareholders' equity for the third quarter was 14.8 percent.

Max spent 90.9 cents of every premium dollar on claims and expenses, compared to 99 cents in the same period last year. The combined ratio was helped by net favourable development on prior-year loss reserves of $15.2 million.

Max said it had reduced its debts by $375.0 million during the first nine months of the year from $466.4 million at the end of last year to $91.4 million at September 30, 2009.