Bermuda-based Arch Capital posted increased profits and a 20 percent increase in gross premiums written in Q2, focusing heavily on the convergence space and US mortgage business.
Across all segments Arch wrote $1.3 billion of gross written premiums during the quarter and drove its combined ratio down a little over a percentage point to 86.2 percent.
Net income for the quarter reached $202.5 million, a 30.3 percent increase on the year before. Altogether it appears to have been a good quarter for Arch, who have outperformed in spite of difficult conditions in the reinsurance sector and softening on some primary lines.
Arch’s mortgage segment was worthy of particular note, achieving a 196 percent increase in gross premiums written, up to $55.4 million for the quarter, with operating income up 73.9 percent to $8.8 million for the period.
Arch has also started executing its Watford Re strategy, of which Arch holds an 11 percent stake, with Watford Re writing $51.8 million of net premiums during the quarter.
While Arch increased its reinsurance gross premiums written by 9.7 percent, it ceded a significant portion of the business to Watford Re results in a net written premium increase of only 0.2 percent compared with the second quarter of 2013.
Arch also achieved strong growth in its insurance segment, with gross written premiums increasing 21.1 percent for the quarter, up to $852 million, while net income rose sharply to $34.4 million, from $13.6 million during the same period in 2013.
Meanwhile, on the investment side the company was also able to achieve good results in spite of sluggish macroeconomic conditions. Net investment income rose to $72.5 million from $68.4 million in Q2 of 2013.
To continue reading, you need a subscription to Intelligent Insurer. Start a subscription today for £655.
In-house feature articles, the archive and expert comment require a paid subscription. Subscribe now.
Want to give it a try? We are offering a two week free trial to the Intelligent Insurer website – register and select “Two Week Free Trial” to begin access to the full Intelligent Insurer archive and read the latest news, features and expert comment. Begin your free trial here.
Is your 2 week free trial about to end? Upgrade to a 12 month subscription for £655 now.
If you have already subscribed please login.
If you have any technical issues please contact support.
Arch Capital, Bermuda, Second Quarter 2014 Results