Reinsurance drives strong growth at Catlin
Catlin Group posted very healthy growth in the first quarter of 2014 driven by its reinsurance book and international operations. While its CEO warned on softening rates in catastrophe-exposed lines, he said some hardening was occurring elsewhere.
The company’s gross written premiums increased by 9 percent to $2.01 billion in the quarter compared with $1.84 billion a year earlier. Within this, its London and US operations grew by 5 percent, its Bermuda unit by 8 percent and its international operations, comprising Asia-Pacific, Europe and Canada, by 19 percent to post $594 million of GWP in the quarter.
It noted that the total gross premiums written by non-London underwriting hubs increased by 12 percent in the first quarter of 2014 and accounted for 59 per cent of gross premiums written by the Group, a small increase on the year before.
By product group, every division enjoyed growth except the specialty/war & political risk unit which stayed flat. The reinsurance unit, its biggest, grew by 11 percent to GWP of $998 million. It said this in part reflects the continued growth of Catlin Re Switzerland.
Its property unit also grew by 11 percent to $176 million and its casualty unit by 12 percent to $371 million. It said the growth in casualty classes reflects the favourable rate environment and continued growth of US professional lines business.
It said the average weighted premium rates across the group’s underwriting portfolio decreased by 2 percent during the quarter. The biggest decline was felt in catastrophe-exposed business classes, which decreased by 6 percent, but it said rates for non-catastrophe classes increased marginally with rates in some casualty lines increasing by 6 per cent during the quarter.
Stephen Catlin, chief executive of Catlin Group, said: “I am pleased to report that Catlin has achieved a good performance during the first quarter of 2014. Gross premiums written increased across all of our underwriting hubs, with continued strong growth from the International hubs. In addition, there were no catastrophe losses during the quarter and overall loss activity was generally benign.
“Rating levels are still adequate for most classes of business. Average weighted premium rates for catastrophe-exposed classes of business decreased by 6 per cent during the first quarter, but from record levels and we believe there is still good margin to be found in many of these classes. Rates for all other business classes increased marginally, although average weighted premium rates for casualty classes rose by 6 percent.”
“Catlin has made a good start to the 2014 underwriting year. We remain committed to our global operating strategy, which stresses underwriting discipline, diversification and capital preservation, and we continue to look ahead with confidence.”
