GWP climbs 4% during first nine months
London market (re)insurer Markel International’s combined ratio (COR) improved to 86% during the first nine months of 2012 compared to 119% for the same period last year.
The COR improvement was due to a lower current accident year attritional loss ratio, an increase in reserve releases and a benign catastrophe environment compared to the first nine months of 2011.
Markel’s gross written premiums for the first nine months of 2012 climbed 4% to $705m (£442m) from $677m for the same period last year.
The rise was primarily due to an increase in marine, energy and specialty premiums, boosted by an improved pricing environment and organic growth.
Markel finance director Andy Davies said: “We have experienced an excellent first nine months of 2012 with good premium growth, a return to underwriting profitability and excellent investment returns.
“During the first nine months we continued to expand our retail operations in the UK and internationally through the acquisition of Quay Underwriting in the UK, a joint venture with Anglo Underwriting in Germany and the establishment of a marine underwriting unit at our Canadian operation, Elliott Special Risks.
“We have also expanded our marine and trade credit operations in Asia Pacific during the third quarter. Markel International produced underwriting profits and investment returns of $238m for the first nine months of 2012, which contributed to Markel Corporation’s increase in book value of 12% during the same period.”
Markel’s parent company, Markel Corporation, however, suffered a drop in after tax profits to $5.32 per share during the third quarter of 2012 (Q3 2011: $5.48).
Markel Corporation’s net income for the first nine months of this year at $19.67 per share compared to $9.42 for the same period in 2011.
Its COR increased marginally to 101% for the third quarter from 100% for the third quarter of 2011.
But the COR improved to 96% for the first nine months of 2012 from 105% for the same period of last year.
The COR for the third quarter and the first nine months included $31m, or six points and two points, respectively, of reserve releases for asbestos and environmental exposures.
Natural catastrophes accounted for $34m, or seven points, and $133m, or nine points, for the third quarter and first nine months of 2012 respectively in underwriting losses.
Underwriting, acquistion and insurance expenses related to adopting new accounting standards made up $7m, or one point, and $41m, or three points of the COR for the third quarter and first nine months of the year respectively.
Markel chairman and chief executive Alan Kirshner said: “While our results for the third quarter were negatively affected by loss development on our asbestos and environmental reserves, our continuing underwriting operations produced an underwriting profit.
“Additionally, our total operating revenues have grown by 13% on both a quarter and year to date basis.
“We continue to seek growth opportunities. In the non-insurance area, we have added Tromp Bakery Equipment and Reading Bakery Systems to our portfolio of industrial and service companies owned by Markel Ventures.”
Book value per share outstanding increased 12% to $395.48 at 30 September, 2012 from $352.10 at the end of last year.
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