Allied World Q1 results dip as reinsurance unit falters
Profits at Allied World Assurance Company fell in the first quarter of the year, partly as a result in a decrease in the contribution made by its reinsurance division.
The company’s net income fell for the first quarter of 2016 to $74.1 million, compared with $124.4 million for the first quarter of 2015.
The company’s gross premiums written for the first quarter were $863.5 million, a 1.9 percent decrease compared to $880.6 million for the first quarter of 2015. This was driven by a decline in its reinsurance segment, partially offset by growth in the global markets insurance segment. North American Insurance was essentially flat, said the firm.
The global markets insurance segment grew by 94.7 percent on a constant dollar basis and 90.6 percent on an as reported basis, driven by the inclusion of the acquired Asian operations.
The first quarter of 2016 was the fourth quarterly period to include the results of the acquired Asian operations, making future prior year quarter references directly comparable.
The North American insurance segment was essentially unchanged, led by growth across programmes and environmental businesses, offset in part by declines in primary casualty, healthcare, and property businesses.
The reinsurance segment decreased by 16 percent, driven largely by the reduction in property catastrophe risk as well as the non-renewal of certain other property and casualty treaties.
Allied World did not experience any reportable catastrophe losses for the first quarter of 2016 or the comparable quarter last year. Its combined ratio was up considerably to 96 percent in the first quarter of 2016, however, compared with 88.1 percent for the first quarter of 2015.
Net investment income improved by 19.5 percent to $53.3 million from $44.6 million in the prior year quarter.
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