July 28 (Reuters) - Insurance and asset management company Principal Financial Group PFG.O posted a rise in second-quarter profit on Monday, helped by a gain related to remeasurement of certain future policy benefits.
Shares of the company jumped 4.6% in after-hours trading.
Insurance companies set aside capital to cover payments they expect to make to policyholders in the future, based on existing insurance contracts.
A remeasurement gain happens when the company realizes it has set aside too much money and can reduce the liability.
The company swung to a $4.3 million remeasurement gain for the three months ended June 30, compared to a $444.8 million loss a year earlier.
This helped cushion a 27.5% fall in premiums and other considerations, which came in at $1.4 billion.
Fees and other revenue rose to $1.08 billion from $1.06 billion a year earlier.
The company's fees are typically calculated as a percentage of its assets under management.
A late-quarter market rally also helped boost Principal's AUM by 8% to $752.7 billion in the reported period.
Profit attributable to Principal Financial was $406.2 million, or $1.79 per share, in the quarter ended June 30, compared with $353.1 million, or $1.49 per share, a year earlier.
(Reporting by Ateev Bhandari in Bengaluru; Editing by Alan Barona)
((Ateev.Bhandari@thomsonreuters.com))
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