Conduit Re estimates Q3 catastrophe claims of $50m

Conduit Re recorded an aggregate undiscounted net loss from catastrophe and risk events of $50 million in the third quarter, the company said today. 

The Bermuda-based reinsurer said the claims would push the company’s combined ratio into the mid-90s, through the first nine months of the year. 

The company also expected to incur losses, net of reinsurance, of between $30 million and $50 million from Hurricane Milton, which struck Florida in October.  

Looking forward, the company said: “Recent natural catastrophe and risk events, as well as pre-2020 industry legacy reserve development, are expected to support a resilient pricing outlook.” 

The catastrophe claims came as Conduit said gross written premiums rose 25.2% to $957 million in the first nine months of the year. 

"Our increase in premiums written of 25% year-on-year reflects continued growth into our capital base, in what we view as a strong market with healthy rate adequacy,” said Trevor Carvey, Chief Executive Officer. 

“We have seen an active quarter from an event perspective, notably natural catastrophe events across the US, Canada and the Caribbean, and as a well-diversified, predominantly quota share reinsurer we pick up our fair share of these, as we expect to do so.

“Looking forward and into 2025, we remain committed to risk selection and growing our business in a measured and balanced manner."

The company also said reinsurance revenues rose 30.3% to $588.2 million over the first nine months .  

Gregory Roberts, chief underwriting officer, commented: "With two months remaining in the year, the reinsurance industry has already experienced a significant level of natural catastrophe and large loss activity. 

“Pricing conditions remain broadly stable and benefit from several years of compounding rate increases. As a trusted partner, our underwriting team engages with clients in what is a dynamic marketplace as we continue to grow while maintaining the balance of our overall portfolio." 

Looking forward, Conduit said it believe property and specialty lines offered “continued opportunities for growth”, adding: “The market outlook supports good risk/return dynamics, and our portfolio is well positioned to respond to market conditions. Rates in loss exposed classes, such as marine liability and civil unrest, are likely to respond positively.”

It said its clients were engaging early in January 1 renewal discussions. 

By segment, Conduit's specialty gross written premiums jumped 39% to $197.7 million while the larger property portfolio rose the most in volume rising 33% to $536 million. Casualty edged up 2% to $223 million. 

The company said its investment return for the nine months ended 30 September 2024 was 4.9%, driven primarily by a significant decrease in treasury yields during the third quarter, combined with investment income given a generally higher yielding portfolio. This compared to a return of 2.1% in the same period in 2023.

Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.