Beazley plots 2024 growth: can nearly hold property & cyber momentum
Beazley could target net premium growth in 2024 at 20%, only a slight slowdown to the mid-twenties seen for 2023 as the group continues to pile into property and cyber while trimming select reinsurance cover, top officials have said.
“We are planning to grow in 2024,” Cox told a call for equity market analysts of what officials consider the early view to 2024.
“Growth will be from property, it will be from cyber,” but complemented by only “a little bit of growth" on the side of the marine, accident and political risks division (MAP), Cox said. Growth in those specialty risks “will be flatter,” he added.
For 2023, management reiterated a growth target in the mid-twenties net of declining reinsurance cover above premium growth in the mid-teens at the gross level.
“I don't think our property business will grow as fast next year as it has this year,” Cox said, “although it should continue to grow.”
Growth in 2023 and 2024 should fully utilise the $400 million in top-up capital which Beazley gathered from investors in a late 2022 SPO, Cox claimed. Those funds “will be fully deployed in 12023 and 2024,” he said.
Net growth rates can beat gross growth as Beazley continues the pull-back from quota share reinsurance coverage already notable in 2023 results to date, Cox said. Cyber and MAP can ride a bit more bare, he indicated.
Cyber growth will continue apace as Beazley can shift its focus away from the US, where the large-cap market now has fuller penetration, and into international markets where catch-up growth opportunities remain large.
2025 remains too distant for further growth speculation, but Cox did express hope that market conditions would support a continued aggressive stance.
The 2024 growth targets remain “early stage,” CFO Sally Lake reiterated throughout the conference. An update to guidance is possible before year-end.
Beazley separately reiterated its forecast for a full-year combined ratio in the high 80's when measured on the old IFRS4 scale, which translate to the low-80's on an undiscounted adjusted measure to the new IFRS17 standard.
We also reiterate our guidance for the full year combined ratio on an IFRS 4 basis of high eighties. This is equivalent to a combined ratio guidance of low eighties on an undiscounted IFRS 17 basis.
For the first half, Beazley claimed a $366.4 million pre-tax profit, up fractionally from the prior year. Management cited “significant growth” in the North American property business and “momentum in cyber across Europe.”
H1 insurance written premiums rose 13% to $2.9 billion, rendering a 30% increase in net written premium following the reduction in reinsurance cover.
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