Rates decline 1.3% for Brit in 2017
Specialty re/insurer Brit experienced an overall rate reduction of 1.3 percent in 2017, following a 3.3 percent reduction in 2016.
“Market conditions have, as expected, remained difficult during 2017,” Brit CEO Matthew Wilson, commented.
“Against this backdrop, we have maintained our rigorous risk selection in the classes experiencing pressure and continue to focus growth efforts in classes experiencing more favourable rating conditions,” Wilson noted.
Gross written premiums grew to $2.06 billion in 2017 from $1.91 billion in 2016. The combined ratio deteriorated to 112.4 percent compared to 96.4 percent over the period. The 2017 figure included 16.2 percentage points of major losses compared to 4.5 percentage points in 2016. Claims arising from the major loss activity in 2017 totalled $250 million.
“2017 was dominated by the scale and multiplicity of natural catastrophes from hurricanes, earthquakes and wildfires, resulting in significant human and economic consequences in the regions affected,” Wilson noted. “Our focus has been on providing an outstanding claims service and we have been pro-active in ensuring our customers’ needs have been at the forefront of our actions”.
Brit’s net profit declined to $21.5 million in 2017 from $157.6 million in 2016.
Despite the harsh operating environment, Brit is expanding the business.
During 2017 Brit’s US operation, BGSU, reached the milestone of writing over $1 billion of premium since its formation in 2009, Wilson said.
Brit also launched Syndicate 2988 in 2017, reinforcing the firm’s long-term commitment to the Lloyd’s market and ambition to use its infrastructure to expand its current position as the largest Lloyd’s only insurer, Wilson explained.
Furthermore, in December 2017, Brit launched a new Bermuda-domiciled collateralised reinsurance platform, Sussex Capital, with initial funding of $102.5 million. From 2018, Sussex Capital will write direct collateralised reinsurance while also providing collateralised reinsurance to Brit's Syndicate 2987. “Its launch strengthens Brit's reinsurance capability, provides access to a diversified source of capital and further enhances our client and broker proposition,” Wilson commented.
While Wilson noted that the outlook for 2018 seems more positive with some encouraging signs of rate improvements in certain classes, Brit continues operating in “a fiercely competitive market environment.”
“Notwithstanding, we believe that with highly disciplined underwriting and our strategic focus on market leadership, innovation in product and process, and the broadening of local product distribution, we can look to the future with confidence,” Wilson said.
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