(Reuters) - MetLife Inc (NYSE:MET)'s fourth-quarter profit rose nearly 7% to surpass Wall Street estimates on Wednesday, as strong investment gains cushioned the hit from higher pandemic-related claims in some parts of its business.
The U.S. insurer reported an adjusted profit of $2.17 per share, compared with $2.03 a year earlier. Analysts on average had expected $1.47, according to Refinitiv data.
New York-based MetLife's net investment income jumped 7% on an adjusted basis to $5.2 billion, bolstered by higher returns from its private equity investments.
Insurance providers worldwide have recorded rising investment returns over the past year as markets continue to rebound from a pandemic-induced slump, helping offset a jump in claim payouts related to the coronavirus crisis.
Vaccine rollouts were expected to ease the burden for insurers, but the highly infectious Delta variant ratcheted up COVID-related claims to $5.5 billion in the first nine months of last year, far higher than the total for all of 2020.
Insurers reported higher COVID-related fatalities last year than in 2020, when the deaths were mainly among older people who typically do not take out life insurance.
The company's group benefits unit saw a 95% slump in earnings in the quarter, hurt by unfavorable group life underwriting as a result of COVID-19.
Adjusted earnings for the insurer's U.S. business fell 37% to $640 million from unfavorable underwriting, while Asia posted a 19% rise thanks to higher investment income.
For Latin America, adjusted earnings surged to $125 million from $14 million in the same quarter a year earlier due to lower COVID-related claims.
MetLife logged a $196 million loss from net derivatives, driven by forex rate changes and stronger equity markets. Such derivatives are held to hedge against market volatility.