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We may also discuss certain non-GAAP financial measures in the call today. You may find a reconciliation to GAAP of these measures either in the press release or in our website at www.markelcorp.com in the Investor Information section under non-GAAP reconciliation. With that, Anne?Anne Waleski Thank you, Tom, and good morning everyone. I am going to follow the same format that I have in prior quarters. I am going to focus my comments primarily on year-to-date results. I will start by discussing our operational results, a brief discussion of our investment results and bring them together with a discussion of our total results for the year. Our total revenue grew 18%, $2.6 billion in 2011 from $2.2 billion in 2010. The increase was due to increased revenue from our insurance operations and our non-insurance operations which we refer to as Markel Ventures. Moving into the insurance results gross premium volume was just under $2.3 billion in 2011, up 16% compared to 2010. This increase was due to higher gross premium volume in the Specialty Admitted in London Insurance market segment. As of September 31st, 2011 the Specialty Admitted segment included $227 million of gross written premium from our FirstComp workers’ compensation operations, which we acquired in late 2010. The increase in gross written premiums in the London Insurance market segment was due in part to an increase in premiums written by Elliott Special Risks, which was converted from an MGA operation to a risk bearing insurance division during 2010. We also saw significant increases in premium volumes within our Marine and Energy division due in part to offering large loan sizes and an improved pricing environment. Net written premiums were approximately $2 billion, up 15% to the prior year. Retentions were at 89% in both 2011 and 2010. Earned premiums increased 14%, and included approximately $200 million of earned premiums in the Specialty Admitted segment from FirstComp compared to $37 million last year. The increase in earned premium was also due to higher credit premium volume in the London Insurance Market segment, compared to 2010.
Our combined ratio was 102% for 2011 compared to 97% in 2010. Our goal is to earn underwriting profits and we are disappointed that we failed to meet that goal this year. The increase in the combined ratio was due to a higher current accident year loss ratio, partially offset by more favorable development of prior years’ loss reserves and a lower expense ratio compared to 2010.The combined ratio for 2011 included $152 million, or 8 points of underwriting loss related to natural catastrophes. Including loss from the Thai floods in the fourth quarter and losses from Hurricane Irene, the U.S. tornadoes, the Australian floods, the New Zealand earthquakes and the Japanese catastrophe all which occurred during the first nine months of 2011. Our 2010 combined ratio included $17 million or 1 point of underwriting loss related to the Chilean earthquake. The 2010 combined ratio also included $75 million or 4 points of underwriting loss and two program now in run-off that were exposed to losses associated with the adverse conditions in the residential mortgage market. Favorable redundancies on prior year’s loss reserves increased to $354 million or 18 points of favorable development compared to $278 million or 16 points of favorable development in 2010. The increase was primarily due to more favorable development of prior year losses in the E&F segment. Our 2011 expense ratio was 41% that's down approximately 1 point as compared to 2010. The lower expense ratio in 2011 was primarily due to lower cost associated with our system and business process initiatives and lower profit sharing expense. Next, I’ll discuss the results of our Markel Ventures operation. In 2011, revenues from Markel Ventures were $317 million as compared to $166 million in 2010. Net income to shareholders from Markel Ventures was $7.7 million in 2011 as compared to $4.2 million in 2010. Revenues and net income to shareholders from Markel Ventures increased in 2011 as compared to 2010 primarily due to our acquisitions of RD Holdings often known as Retain Data, and Diamond Healthcare in late 2010. Read the rest of this transcript for free on seekingalpha.com