Brit returns to profit for 2019 on back of ‘strong underwriting’
Global specialty insurer and reinsurer Brit returned to profit in 2019. It credited strong underwriting with driving the turnaround, contributing $68.4 million to the result.
This comes at the end of a busy year for Brit in which it invested in or acquired a number of managing general underwriters including Ambridge Partners and Sutton Special Risk.
Brit’s gross written premiums for 2019 were $2.3 billion, a 2.4 percent increase on the 2018 figure of $2.2 billion. Its combined ratio was 95.8 percent, a significant improvement on 2018’s figure of 103.3 percent. Profit on ordinary activities before tax was $186.3 million, as compared to a loss of $190.3 million in 2018.
Matthew Wilson, group chief executive officer of Brit, commented: “I am pleased to report a return to profit for Brit. Given the ongoing market environment, I believe this is an encouraging set of results reflecting our clear strategy, which is focused on leadership, innovation and distribution, and the talent and commitment of our people.”
Mark Allan, group chief financial officer, added: “For Brit and the wider market, 2017 and 2018 have proved to be challenging years, with a number of early large losses and attritional pressure occurring in addition to significant catastrophes in those years. However, we have seen more benign claims activity on older years, with 2016 and prior showing releases, resulting in an overall $47.9m reserve release, equivalent to a 2.9pps reduction in the combined ratio. It was particularly pleasing that despite major catastrophe loss creep for the market, there was no material change to our overall net 2017 and 2018 major loss position.
“Our investment return was $148.1m (net of fees), a return of 3.6 percent. This was driven by the strong performance of our equity portfolio, which recovered the losses experienced in late 2018 as markets rebounded, and by the performance of our fixed income portfolio which also generated positive income and capital returns.
“Preserving a strong financial position is critical to the long-term success of an insurance business. Our balance sheet remains strong as we maintain our ‘conservative best estimate’ reserving policy which provides us with a secure foundation.”
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