Argo Group posted a solid set of results for the second quarter of 2014 but its chief executive officer warned on what is an increasingly competitive environment.
The Bermudian generated second quarter operating profits of $23.8 million compared with $20.7 million for the second quarter of 2013.
Its net income also rose to $38.6 million for the quarter, compared with $31.7 million in the second quarter of 2013. The combined ratio for the quarter was 95.8 percent, an improvement from the second quarter of 2013 where it hit 98.3 percent.
However, its gross written premiums (GWP) fell to $520.1 million, compared with $542.2 million in the prior year second quarter.
The excess and surplus lines segment’s GWP remained flat at $175.8 million. Argo said growth in selected specialty and casualty lines of business is being offset by increasingly competitive market conditions and premium reduction in transportation as it continues to run off its commercial auto book.
Commercial specialty and Syndicate 1200 also suffered from decreases in GWP, with a fall of 2.3 percent and 11.6 percent respectively. GWP only increased in Argo’s international specialty unit where GWP hit $97.4 million in the quarter, up 1.3 percent from the second quarter of 2013. It said that the growth was driven by business in Brazil, partially offset by a decline in short-tail reinsurance business.
“Argo Group delivered another quarter of solid results despite the challenges of an increasingly competitive market environment," said Argo Group chief executive officer Mark Watson. “We remain focused on disciplined, profitable underwriting while growing our better performing books of business.”
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Argo Group, Bermuda, Second Quarter 2014 Results, Mark Watson