Bermuda-based Everest Re Group has reported first quarter 2016 after-tax operating income of $222.7 million, down from the $329.9 million it made in the first quarter of 2015.
Net income was $171.7 million for Q1 2016, compared to net income of $323 million for the same period last year.
Gross written premiums also decreased 5 percent to $1.4 billion compared to the first quarter of 2015, but according to the company, after eliminating the unfavourable effects of foreign currency fluctuations, premiums were actually down 3 percent.
Worldwide, reinsurance premiums were down 8 percent, on a constant dollar basis, while insurance premiums were up 11 percent, quarter over quarter.
The combined ratio was 86.0 percent for the quarter, compared with 83.1 percent in the same quarter of 2015. Excluding catastrophe losses arising from the Taiwan earthquake that occurred in the quarter, and prior year development, the attritional combined ratio was 85.3 percent compared to 83.1 percent in the same period last year.
Net investment income for the quarter was $102.5 million, including a loss of $6.2 million on limited partnership investments. This was down on net investment income from the same period of last year, at $122.6 million.
Dominic Addesso, president and chief executive officer, Everest Re, said: “Against the backdrop of what continues to be significant challenges affecting both investment and underwriting activities, Everest produced strong results with an annualised operating return on equity of 12 percent for the quarter.
“While foreign currency headwinds and declining rates are hampering growth in our reinsurance book, we are seeing strong and profitable growth in our insurance book as new initiatives take hold.”
Effective this quarter, the company adopted Accounting Standards Update 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis”. As a result, the segregated accounts of Mt Logan Re have been deconsolidated from the company results.
The adoption of this amended accounting guidance has been implemented utilising a full retrospective application for all periods. This change had no impact to the prior reported net income or retained earnings of the company.