Catastrophes push Lancashire into loss

Lancashire Holdings reported a pretax loss of $72.9m for the year to December, against a profit of $150.4m a year earlier.

The specialist insurer was hit by a series of natural catastrophes, including hurricanes in the Caribbean and Gulf of Mexico, two earthquakes in Mexico and wildfires in California.

Gross written premium fell to $591.6m from $633.9m, while the combined ratio shot up to 124.9% from 76.5%. The accident year ratio rose to 94.2% from 46.2% a year earlier.

Chief executive Alex Maloney said the natural disasters resulted in one of the most severe years for catastrophe losses to the industry as a whole, with losses totalling more than $100bn, placing 2017 in the top three years for aggregate catastrophe losses in recent history.

“Such events are not unprecedented and, as a catastrophe (re)insurer, we plan our underwriting, reinsurance programme, capital and risk levels in anticipation of such scenarios,” he said.

“Whilst I am not pleased to lose money, this is always a possibility for such types of event in any single underwriting year.”