Despite slipping profits and the departure of its founder and chief executive, shares of Mercury General Corp. surged more than 7 percent on its third quarter earnings.

The Los Angeles-based auto insurance company reported third-quarter net income of $68.2 million ($1.25 per share), a 7 percent slip from $73 million ($1.33) for the same period a year earlier. The company cited lower investment gains and higher accident losses but still beat Wall Street estimates of $1.13 per share, according to Thomson Financial.

Net premiums for the Los Angeles-based auto insurance company rose 2 percent to $776.2 million. Mercury declared a regular quarterly dividend of 48 cents per share payable Dec. 28 to shareholders of record on Dec. 15.

The company also said Monday that octogenarian chief executive George Joseph, who founded the company in 1962, plans to resign Jan. 1. Gabriel Tirador, president and chief of operations, was appointed by the company’s board to replace Joseph.

Shares in Mercury were up $3.66 a share to $55.04 in early trading Monday.