Markel's underwriting profit rises 120% to $16.3m
A strong underwriting performance from Markel International, which manages the international operations of Markel Corporation, supported an 8% increase in book value per share of Markel Corporation for the first half of 2009.
Markel International’s underwriting profit rose 120%, to $16.3 million in the six months to June 2009 from $7.4 million reported in the same period in 2008.
Markel Corporation reported comprehensive income of $171.9 million for the quarter ended June 30, 2009 compared to a comprehensive loss of $93.7 million for the second quarter of 2008.
Comprehensive income was $169.9 million for the six months ended June 30, 2009 compared to a comprehensive loss of $113.6 million for the same period of 2008.
The combined ratio for the second quarter of 2009 was 99% compared to 95% for the second quarter of 2008. The combined ratio was 97% for the six months ended June 30, 2009 compared to 93% for the same period of 2008.
Shareholders' equity increased 8% to $2.352 billion at June 30, 2009 from $2.181 billion at December 31, 2008.
Chairman and CEO Alan Kirshner said: “Our increase in book value per share resulted from improved investment results and strong underwriting performance from our international operations during the first six months of 2009. While competition continues to be intense in the property and casualty insurance marketplace, we remain focused on disciplined underwriting and our long-term performance goals. With strong liquidity and a solid balance sheet, we are well positioned for future growth opportunities.”
Markel International reported a reduction in gross written premiums to $173 million for the second quarter of 2009 from $203 million in the same period of 2008. Gross written premiums for the six months ended June 30, 2009 were $358 million compared with $405 million in the same period of 2008. The combined ratio was 91% and 94% respectively for the quarter and six months to June 30, 2009 compared with 99% and 98%, respectively, for the same periods in 2008.
Finance director Andy Davies said: ""After adjusting for exchange rate movements gross written premiums for the first six months of 2009 were at similar levels to 2008. Growth in our Marine and Energy division, due to strong rate increases, has been offset by reduced premium income in our Professional and Financial Risks and Delegated Property business, primarily due to competition driving down rates to unprofitable levels. While the level of written premium reflects our continued commitment to underwriting discipline, we have begun to see some signs of moderate price increases in several product lines.
“The excellent underwriting results during the quarter and half year reflect both a quiet half year on the loss front and reserve redundancies on the 2003 to 2006 accident years. The investment portfolio of both Markel Corporation and Markel International generated annualised returns in excess of 7% for the first six months of 2009. The strong performance was primarily due to increases in the market value of the corporate bond and equity investment portfolios and is a welcome relief after the difficult investment conditions experienced in 2008."