Alterra deal boosts Markel’s Q1 results

Markel Corporation posted steady profits in the first quarter of 2014 on the back of a big jump in its gross written premiums, largely in its reinsurance book as the company benefitted from its acquisition of Alterra a year ago.

The re/insurer made a net profit of $87.7 million compared with $88.9 a year earlier although it noted that the comprehensive income to shareholders, which includes gains on its investment portfolio, was $230.3 million for the quarter compared with $257.7 million in the first quarter of 2013.

Its gross written premiums increased to $1.35 billion, an 82 percent increase compared with the $743 million it wrote a year earlier. Much of this gain occurred in its reinsurance book – boosted by the acquisition of Alterra in May 2013 – which posted GWP of $489 million versus $62 million the year before.

Alan Kirshner, chairman and chief executive of Markel, said: “During the first quarter of 2014 we increased total operating revenues by 51 percent compared with the same period last year while achieving profitable underwriting results in each of our ongoing underwriting segments.

“One year later, we have completed the integration of Alterra into our insurance operations and are pleased with the results. In the first quarter of 2014, we reorganised our reporting structure and now report our ongoing insurance operations in three segments: US insurance, international insurance and reinsurance. We also increased our international presence in 2014 with our acquisition of Abbey Protection, an integrated specialty insurance and consultancy group headquartered in London.”

Commenting on the performance of Markel International, William Stovin, president and chief operating officer, said: “We had an excellent start to 2014 with strong premium growth and excellent underwriting profits at both our wholesale and retail operations. Premium income increased by 40 percent to $414m for the first quarter as a result of the Alterra business that we acquired in May 2013 and organic growth in our retail business both here in the UK and in our overseas offices. We are delighted with the progress we have made in the integration of Abbey Protection which we acquired in January this year.”