Corte Madera, CA - Terra Insurance Company’s book value per share set another new all-time high at the end of the third quarter, reaching $260.06 at September 30, 2009. The new high represents a 7.1% increase since January 1, 2009. Terra’s earnings since January 1 were $10.39 per share, almost 20% ahead of what they were on September 30, 2008.

“Terra has generated net income in every calendar quarter of its existence as a risk retention group,” said Terra President and CEO David L. Coduto. “This is not the first economic downturn we’ve weathered profitably, and I’m confident it won’t be the last.”

The second-oldest professional-liability (PL) insurer in the United States – the company was established in 1969 – Terra became a risk retention group in 1988. Initial owner/insureds – most of which are still insured by Terra – purchased their stock for $10 per share.

Mr. Coduto noted that Terra’s underwriting income (income exclusive of investment returns) was more than double what it was at September 30, 2008. Part of this was due to a more-than one-third jump in net premium written. Other factors cited by Mr. Coduto included lower reinsurance costs and underwriting expenses.

Mr. Coduto said that the company has responded to “uncertain and volatile economic conditions” by treating its loss provisions in a “prudent, conservative manner,” even though “Terra has not yet experienced the growing claim frequency and severity that other PL insurers have been reporting and, if experience is an indicator, we likely will not. In fact, if current claims frequency holds steady through the end of the year, Terra will have achieved the fewest number of reported claims in its 41-year history, despite growth in the underlying fee base and projects performed per insured.” Mr. Coduto attributed Terra’s record to its underwriting criteria and to the company’s investment in its owner/insureds’ professional development. He said that, to the best of his knowledge, Terra invests more money “in risk management and loss prevention training than any other U.S. PL insurer, on a per-insured basis. Experience shows that the techniques Terra supports not only help keep claims low, they also increase client loyalty, possibly explaining why Terra owner/insureds have also reported increased revenues at a time when most similar firms have been reporting revenue contraction.”

Terra provides a variety of professional-liability insurance products to civil, environmental, and geoprofessional engineering firms that gross from $300,000 to more than $100 million annually. Because Terra is a risk-retention group, all its insureds must also be owners of the company. A.M. Best Company – the internationally recognized insurance-company rating organization – reports that Terra is “the highest-rated risk-retention group in the United States.” (Terra’s score on A.M. Best’s “Capital Adequacy Ratio Tests” is one of the highest of all insurers – not just professional-liability insurers – doing business in the United States.)

More information about Terra and its PL products is available at www.terrarrg.com, along with an array of free risk-management materials. Contact Terra Insurance Company by e-mail (terra@terrarrg.com) or telephone (1/800-872-0077; in CA, 415/927-2901), or by writing to it at 2 Fifer Avenue/Suite 100, Corte Madera, CA 94925.