WR Berkley adds Q1 margin on ca. 11% top line growth
US insurance group WR Berkley tightened first quarter underwriting margins while growing its top line nearly 11%, all part and parcel with a 50% increase in Q1 net profits, financial statements out Tuesday indicated.
“We had a very strong and solid quarter,” CEO Bob Berkley said in the opener to his company’s Q1 earnings call. “A great way to start the year.”
Net written premium grew 10.7% year on year to $2.85 billion, led by 11.9% growth in the mainstay segment of primary insurance ahead of 4.2% growth in the smaller segment of reinsurance e and monoline excess.
“Market conditions remained favourable in many areas of our business,” management said to explain the rise in premiums.
In insurance, that growth was focused on short-tail lines, a catch all title for commercial multi-peril (non-liability), inland marine, accident and health, surety, boiler and machinery, high net
worth homeowners and more, up an aggregate 25% year on year.
In contrast, Berkley showed a clear aversion to workers comp, down 1.7% year on year, and professional liability, down 3.6% year on year.
Reinsurance showed a mixed bag with the tiny property reinsurance premium tally up 34% to offset a 10% decline in casualty reinsurance.
Margin gains followed what management considered a “prudent view of loss trends” and “flexibility to expand or contract each of our businesses according to specific market conditions.”
For the group as a whole, mark the GAAP combined ratio down 1.8 points from the prior year period to 88.8% including a roughly 0.8 point decline in the cat load to 1.1% of NEP. The headline decline is a modest 1 point in primary insurance and a heftier seven points in reinsurance and monoline excess.
Together with a pick up in net investment income, WR Berkley managed a 50% gain in attributable net profits to $442 million.
“Our results demonstrate how our persistent focus on risk-adjusted return in all aspects of our business allows us to successfully navigate risks and embrace opportunities,” management said. “We remain confident that we will continue to deliver outstanding value to shareholders in 2024 and beyond.”
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