Arch’s Q2 net profit falls by 41%

Arch Capital Group has posted a 41% year-on-year decrease in net profit available to common shareholders in its 2022 second quarter results to $394 million from $664 million. For the first-half period to 30 June, net profit fell by 47% to almost $580 million from the $1.09 billion it had achieved in H1 2021.

Gross written premium (GWP) in the second quarter rose by 17.8% to $3.87 billion but the company’s combined ratio dipped by 4.9 points on the prior year to 77.1%.

GWP in its insurance segment rose by nearly 25% in the second quarter, to over $1.7 billion, but its combined ratio lost 3.2 points to 91.1%.

Net premiums earned in the 2022 second quarter were 27.4% higher than in the 2021 second quarter, and reflect changes in net premiums written over the previous five quarters. Arch said the higher level of net premiums written reflected increases in most lines of business, due in part to rate increases, new business opportunities and growth in existing accounts.

GWP in the reinsurance segment in the 2022 second quarter were 32.1% higher than in the 2021 second quarter, while net premiums written were 25.7% higher. The growth in net premiums written reflected increases in other specialty, property catastrophe and property excluding property catastrophe lines, primarily related to rate increases, new business opportunities and growth in existing accounts.

GWP in the mortgage segment in the 2022 second quarter were 5% lower and net premiums written were 12.5% lower. The reduction in GWP mainly reflected lower US primary mortgage insurance single premium volume and a decrease in monthly premiums. Net premiums written for the 2022 second quarter reflected a higher level of premiums ceded than in the 2021 second quarter.