A Week of Good News
The FTSE listed insurance groups Beazley, Hiscox and Lancashire saw their share prices leap this week as a result of positive results as at 30th June.
Beazley reported half-year profits double last year’s at some US$728.9m. Their complete press release is available here and the slides from their presentation here. The highlights are the 25% growth in property premiums, the confirmation that the impact of the CrowdStrike outage will be “immaterial” with just 179 notifications. The undiscounted* combined ratio (“COR”) came in at a better than expected 81% (88% for HY 2023) despite some considerable losses occurring around the world of about US$60bn. Investment income contributed US$252m on a US$10.7bn portfolio of investments. The market environment is described as moderating but Beazley also describes it as “stable and sustainable” with property rates still increasing by 3%. The syndicates’ forecasts will be published on Friday 16th August.
*the combined ratio (claims + expenses divided by premium) can be discounted under new accounting rules for the time value of money.
Hiscox reported US$284m profits for the first six months of 2024 based on US$2.81bn of premiums, primarily growing in retail and reinsurance. Group’s COR 90.4%. In the areas most relevant to Members’ support of Synds 33 and 6104, the London Market division reported a COR of 86.9% (average rate increase +4%) and of 77.3% for the reinsurance division. Cyber and D&O rates continued to reduce but property still showing “advantageous pricing and terms.” Rates chart pictured below.
Their press release and slides available here. The syndicate forecasts should be out next week.
Lancashire reported its best ever half-year profit of US$200m with premiums up 8% to US$1,282m as a result of strong growth in property and specialty reinsurance lines. Similar yield on investment to Beazley’s at 2.3% adding US$75m. The undiscounted COR stands at 82.2% (79.2% HY1 2023). Rate increases of +2%. No material losses to report. The half year press release and slides are available here.
Lloyd’s rating and Central Fund reinsurance
In other welcome news this week, AM Best, has revised the financial strength rating for Lloyd’s to A+ (superior) from A (excellent). This was as hoped and follows the similar upgrade that Lloyd’s received from Standard & Poor’s to AA- last year. Lloyd’s also confirmed that the US$1bn multi-year Central Fund reinsurance – first placed in 2021 – has been renewed for five years. The background to the protection is available in this earlier Lloyd’s press release.
Hurricane Debby
Gallagher Re has produced its preliminary estimate for the insured losses of this recent category 1 hurricane (affected Florida, Georgia and the Carolinas) of between US$1bn to US$2bn.