NU Online News Service, Aug. 12, 12:15 p.m.EDT

Nationwide Insurance reports a 2011 second-quarter net loss of$292 million, driven almost exclusively by weather-related lossesthat were among the highest the company has ever experienced in thefirst half of a year.

The company says it had $1.5 billion in weather-related claimsover the 2011 first half.

In the 2010 second quarter, Nationwide reported net income of$88 million.

Nationwide took a 2011 second-quarter operating loss of $77million, compared to operating income of $327 million in the 2010second quarter. Property and casualty operations suffered a $391million operating loss in the quarter—due to the weatherlosses—while financial services saw operating income of $315million.

Chief Financial Officer Mark Thresher tells NU Online NewsService that the company is taking a look at where the weatherlosses occurred and at the company's concentration of risk todetermine if Nationwide should diversify to other regions. But hesays there have been no decisions made on pricing or riskconcentration as of yet. He emphasizes that the second quarter wasunusual with respect to the weather events that caused highlosses.

He notes that second-quarter investments were solid and thatnon-weather-related claims experience improved, and he says thecompany is pleased with first-half results given the high weatherlosses in the second quarter.

For the first half, Nationwide reports net income of $219million compared to $483 million a year ago, and operating incomeof $398 million compared to $759 million for the 2010 firsthalf.

P&C direct written premiums were essentially flat in thesecond quarter and first half at $3.77 billion and $7.36 billion,respectively, compared to $3.75 billion and $7.36 billion for thesame time periods a year ago.

Nationwide says it saw a 10 percent increase in direct channelpremiums and 20 percent growth in affinity channel premiums.Additionally, premiums in the company's commercial business—whichconsists of small “Main Street” risks—grew 4 percent compared tothe 2010 first half. Thresher also says Scottsdale Insurance,Nationwide's excess and surplus lines business, is growingwell.

He says lines that are still lagging with respect to writtenpremiums are standard auto and homeowners. Premiums written wereimpacted by the company's completion of nonrenewals in certainareas, and he says Nationwide's standard auto agency business is“building momentum, but not growing ahead of last year.”

In a statement accompanying the company's results, Threshersays, “Personal-lines results continue to be challenged due to thesevere spring storm season and the uneven economic recovery. Yet,we are encouraged by improving trends with regard to new businessand retention levels.”

He tells NU Online News Service that the economy is still“sluggish and slow,” but that the improvements seen in Nationwide'scommercial business “tells me that Main Street busiensses may bestarting to do better.”