(Re)insurer appoints new CFO
Bermuda-based, London-listed (re)insurance group Lancashire Holdings made a net profit of $199m for the first nine months of 2010, down 22% from the $255.8m it made in the same period last year.
Lancashire’s nine-month combined ratio was 65.1% in 2010, up from 51.3% in 2009.
The dip in nine-month profit and combined ratio increase were driven by first-half losses, in particular related to the Chile earthquake and the Deepwater Horizon oil rig explosion. However, Lancashire said that despite an active Atlantic wind season, there were low loss levels in the third quarter, and the company only had minimal exposure to September’s earthquake in New Zealand.
Accordingly, the combined ratio for the third quarter of 2010 alone was 39.2%, compared with 39.1% for the same quarter last year.
Third quarter net profit dipped 2.5% to $106m from $108.7m. Gross written premiums in the quarter were down 3.4% to $135m from $139.7m.
As expected, the Deepwater Horizon loss prompted increased demand and higher rates in the global energy market, prompting Lancashire to boost gross premiums by 16% in the quarter. However, the company continued to reduce its exposure on property direct and facultative and reinsurance lines because of a steady decline in the number of adequately-priced deals. The company reduced property gross premiums by 25% in the quarter.
Given the growth in Lancashire’s excess capital, the company has decided to augment its share buy-backs with a special dividend. It will pay a dividend of $1.40 a share, resulting in an aggregate payment of $213m.
Separately, the company has named Elaine Whelan as its new chief financial officer, who will replace Neil McConachie on 1 January next year. McConachie will continue in his role as president of Lancashire, which he assumed last year, and will remain as CFO until Whelan’s formal appointment.