AXIS Capital reports steady profits but reinsurance GWP drops
AXIS Capital has reported a small rise in its gross written premiums (GWP) in the third quarter of 2016, despite its reinsurance business shrinking significantly.
The company made a net profit of $177 million in the third quarter compared with $248 million for the third quarter of last year. For nine months ended September 30, 2016, it made a profit of $335 million compared with $467 million for the corresponding period of 2015.
Although this gives the impression that the Bermuda re/insurer’s profits have dropped, its results in 2015 were skewed by $280 million of termination fees received following the termination of the amalgamation agreement with with PartnerRe as well as reorganization and related expenses of $46 million.
In fact, AXIS Capital’s insurance and reinsurance segments had a more profitable third quarter year-on-year.
The insurance segment reported an underwriting income of $25 million, compared to $7 million in the third quarter of 2015.
The reinsurance segment reported underwriting income of $79 million for the third quarter, compared to $49 million in the third quarter of 2015.
The company also enjoyed steady growth. AXIS Capital reported gross premiums written of $1 billion for the three-month period ending September 30, up 2 percent year-on-year.
Specifically, the insurance segment reported GPW of $675 million, up 11 percent.
Its reinsurance segment reported GWP of $285 million, down 14 percent.
It said the decrease in reinsurance premiums was primarily driven by our professional and liability lines where the restructuring of several large quota share treaties affected the timing of premium recognition.
The group’s combined ratio for the third quarter was 92.6 percent, down 4 percentage points.
Albert Benchimol, president and CEO of AXIS Capital, said: “Our results speak to optimisations we’ve made across our businesses to build a more resilient portfolio.
“All three of our businesses – AXIS Insurance, AXIS Re and AXIS Accident & Health -- delivered improved year-over-year results, and ongoing positive performance indicators reaffirm we are on a strong path forward and focused on delivering consistent, attractive returns to our shareholders.
“We continue to take tangible actions to position AXIS for accelerated growth in a transformed insurance marketplace, and are seeing attractive opportunities, notwithstanding a challenging environment.
“Our efforts to further strengthen AXIS' position as a leading specialty insurer and reinsurer were highlighted by the successful launch of Harrington Re with The Blackstone Group this past July, our continued expansion in international markets, and the investments we are making in our marketing and client services.
