Partner Re Q2 P&C earnings impacted by lower reserve releases
Bermuda-based PartnerRe has reported lower non-life underwriting profit for the second quarter of 2018 compared to the same period a year ago due to a reduction in prior-year reserve releases.
The reinsurer’s non-life underwriting profit was $65 million for the second quarter of 2018 compared to $108 million for the same period of 2017. Net favourable prior years' reserve development plummeted to $29 million in the second quarter of 2018 after $110 million in the same period of 2017. The combined ratio deteriorated to 93.8 percent from 87.7 percent over the period.
At the same time, PartnerRe expanded non-life net premiums written by 21 percent in the second quarter of 2018. The increase was primarily driven by new business written in both the P&C and specialty segments.
Overall, the group’s net income dropped to $125 million in the second quarter of 2018 after $191 million in the same period of 2017. Underwriting profits, including both non-life and life and health operations and corporate expenses, were $36 million for the second quarter of 2018 compared to $37 million for the same period of 2017.
“We delivered an annualized Net Income ROE of 8.4 percent in this quarter, driven by solid underwriting profits in both our non-life and life and health segments and a 20 percent increase in net premium written compared to last year’s second quarter,” said PartnerRe CEO Emmanuel Clarke.
“Notwithstanding a competitive reinsurance market, we achieved a positive July 1 renewal where we continued to see increases in business margins. These results, in conjunction with continued improved efficiency in operating expenses, and the impact of higher reinvestment yields on our investment portfolio, position our company well to deliver improved underwriting and financial results during the remainder of 2018,” Clarke added.
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