Reinsurance GWP up 24% as political risk drops 20%
Gross written premiums at Lloyd’s insurer Beazley increased 2% to $1.35bn in the first nine months of 2010 from $1.33bn in the same period last year.
The annualised investment return fell to 0.8% from 2.8%, and rates fell 2% over the period, compared with a 4% increase over the same period last year.
"Profit-focused underwriting underpinned a continuing strong performance at Beazley in the third quarter,” Beazley CEO Andrew Horton said in a statement. “We remain on track to achieve an excellent result in 2010 despite increasing competition for business and catastrophes in Chile and New Zealand.”
Reinsurance gross premiums written were up 24% to $166.6m from $134.7m. Beazley said the growth includes business written by its new special purpose syndicate, 6107, which is supported by third-party capital.
However, political risk and contingency gross written premiums fell 20% to $78.7m from $98.9m, which Beazley said reflects its “prudent underwriting approach in more difficult market conditions.” It added that the level of claims notifications from its political risk account had reduced to normal levels at the start of 2010. “We are confident with the overall level of reserves we hold for this class,” the firm said.
Beazley estimates its losses from September’s earthquake in New Zealand at between $15m and $30m, based on estimated industry-wide losses of between $2bn and $4bn. Its claims estimate for the Chilean earthquake remain in the range of $55m to $75m.
In October, Beazley renewed its banking facility with Lloyds Banking Group, which provides potential borrowings of up to $150m. The cash element of the facility will last for three years, expiring on 31 December 2013, whilst letters of credit issued under the facility can be used to provide support for the 2011 and 2012 underwriting years.