London market insurer Markel International posted a combined ratio of 152% for the first quarter of 2011, up 43 points on Q1 2010’s 109%.
The increase was mainly caused by $67m, or 42 points, of underwriting losses related to the Australian floods, the New Zealand earthquake and the earthquake and subsequent tsunami in Japan. The combined ratio was also adversely impacted by $13m of underwriting loss related to severe storm damage to the Gryphon floating production storage and offloading vessel in the North Sea.
Markel International’s gross written premiums increased 22% to $255m in the first quarter of 2011 from $208.2m in Q1 2010. The increase was mainly due to an increase in premiums at the firm’s Canadian subsidiary, Elliott Special Risks.
Markel bought Elliott in 2009 as a managing general agent. It now operates as a risk-bearing division.
In addition, Markel International benefited from an improved pricing environment and organic growth at its marine and energy division.
“Against a difficult underwriting background we are pleased with the premium growth we achieved in the first quarter of 2011,” said Markel International finance director Andy Davies in a statement. “The significant losses reported by the insurance industry are having a positive impact on pricing and with our disciplined underwriting and strong capital position we are in an excellent position to capitalise on opportunities as they arise.”
He added that the losses incurred were within the company’s risk appetite.