Oxbridge Re’s 2016 profits are dented by Hurricane Matthew
Hurricane Matthew hit profits at Oxbridge Re Holdings, a property/casualty reinsurer based in the Cayman Islands that primarily covers insurers in the Gulf Coast, in 2016 and plunged the company into a loss in the fourth quarter specifically but its CEO said he was broadly pleased with its performance.
The company made a net profit of $2.6 million last year, a sharp decline on the $4.6 million it made in 2015. The decrease was primarily due to net underwriting losses related to Hurricane Matthew and other weather-related events experienced during 2016.
In the fourth quarter specifically, Oxbridge Re made a net loss of $2.3 million compared with net income of $0.4 million in the fourth quarter of 2015, again because of losses associated with Hurricane Matthew.
The company’s combined ratio was 91.3 percent in 2016 compared with 26.3 percent in 2015; for the fourth quarter alone its combined ratio totalled 124 percent compared with 27.7 percent for the fourth quarter of 2015.
Oxbridge Re’s net premiums earned totalled $18.1 million in 2016, compared with $6.8 million in 2015. It said the increase was a result of the derecognition of approximately $11.3 million of loss experience refund payable during 2016, as the company experienced losses under one of its retrospectively rated contracts.
Its net investment income in 2016 totalled $450,000 coupled with $554,000 of net realized investment gains. This compares with $337,000 of net investment income offset by $325,000 of net realized investment losses and $399,000 of other-than-temporary impairment losses for 2015.
"Our diversified book of business produced $2.6 million of profit, despite paying out on losses for the year," said Jay Madhu, Oxbridge Re’s CEO. "We believe our positive results for the year were a reflection of our conservative approach and stringent underwriting process.
"We remain committed to our shareholders through the distribution of dividends and the continued repurchase of our common shares. Looking forward, our strong capital position allows us to patiently evaluate the marketplace and seek opportunities to expand and diversify our business of writing fully collateralized reinsurance contracts."
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