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Worried about future inflation? Then this is your preferred stock. Because W.R. Berkley (WRB) CEO William Berkley is too. The insurance exec is building up reserves based on his forecast of 6% inflation not too far down the road.

In the meantime, it doesn’t hurt that this is one of the most conservatively managed insurance companies around as the company’s July 27 earnings report demonstrated. (Of that these preferred shares pay around 7.5%) Those results were good enough that I’m going to edge up my target price on this Jubak’s Picks holding.

For the June quarter, W.R. Berkley reported earnings of 60 cents a share, a penny ahead of Wall Street projections. Net earned premium declined by 8% as insurance prices continued their decline. But, said CEO Berkley, the rate of decline slowed and the insurance market looks set for an upturn beginning in the fourth quarter of 2009 or the first quarter of 2010.

Berkley’s minimal exposure to the market for catastrophic insurance has stood it in good stead during the financial crisis. Because the company doesn’t face big payouts for natural disasters, it’s been able to avoid liquidating riskier parts of its investment portfolio at a loss just to raise funds for a payout.

As of July 31, I’m raising my target price for W.R. Berkley Capital 6.75% preferred to $25 by March 2010. (Full disclosure: I own shares of W.R. Berkley Capital 6.75% in my personal portfolio.)