American Safety Insurance Holdings Ltd. yesterday reported a 44 percent increase in net earnings for the third quarter, as revenues surged 30 percent.

The Bermuda-based insurer said net income was $7.2 million for the three months ended September 30, 2010, or 68 cents per share, as compared to $5 million, or 47 cents per share for the same period of 2009.

The company said total revenues increased 30 percent to $63.3 million, but gross premiums slid 22 percent to $71.9 million.

Stephen Crim, American Safety's chief executive officer, said: "I am pleased with the results for the third quarter with solid growth in book value per share and revenue, as well as strong cash flow from operations.

"The higher revenue in the quarter was driven by increased premiums in newer products added in connection with our diversification strategy. We will continue to evaluate opportunities for acquisitive growth, such as the professional liability underwriting team announced last week, to build our product platform and position the company for more substantial growth when market conditions improve."

The firm's combined ratio - the percentage of premium dollars spent on claims and expenses - improved to 98.3 percent from 100.2 percent for the 2009 quarter.

Annualised return on average equity was 10.3 percent, excluding realised and unrealised gains (losses) on investments.

The company said the increase in total revenue in the quarter from $48.6 million in the 2009 quarter was due to higher net earned premiums resulting from growth in each of its three divisions. The decrease in gross written premiums for the quarter was due to the non-renewal of a specialty programme within the ART division that contributed $40.9 million of gross written premium in the 2009 quarter.

Net earnings for the nine months ended September 30, 2010 were $19.9 million, or $1.87 per share, compared to $17.4 million, or $1.65 per share for the same period in 2009.