Conduit Re hit by steep H1 loss during ‘transition’ phase; pledges stronger resilience
Bermuda-based Conduit Re reported a steep first-half loss as it faced elevated claims and restructured its portfolio in what CEO Neil Eckert (pictured) described as “a period of transition.”
The London-Bermuda reinsurer flagged shifting market dynamics but insisted it is seeing “adequate pricing” in target lines and taking steps to boost resilience and better results.
Conduit Re reported a comprehensive loss of $13.5 million, compared with a profit of $98.1 million in the first half of 2024.
Its combined ratio was 108.3% for the period, a sharp deterioration from 75.1% in H1 2024, as it absorbed hits from wildfires, severe convective storms, and aviation losses “above our normal plan”.
The reinsurer also flagged a significant reserve adjustment tied to a UK High Court ruling on the 2022 Ukraine aviation loss, which materially increased industry-wide insured loss estimates.
Conduit has recognised its need to strategise for resilience in the face of its worrisome combined ratio.
Despite the setbacks, Conduit managed 8.9% growth on gross premiums written, equating to $803 million, up from $738 million in H1 2024.
Eckert said: “We are in a period of transition as we begin positioning the business to be more resilient. We have started initiatives to manage net exposures better, including enhancing our outwards reinsurance programme and refining our portfolio. The process of rationalising our quota share exposure is underway and will lead to less premium in this area, while we have an increased appetite for excess of loss business.
“These adjustments are intended to reduce attritional loss exposure and improve diversification, which we believe will help drive more consistent returns in the future. The actions are further supported by targeted senior hires across key functions bringing valuable expertise and fresh perspectives to the team.”
Looking ahead, the company has revised its return-on-equity expectations for 2025 to the mid-single digits but remains focused on long-term value creation.
“We believe Conduit has a strong foundation from which to build upon, and we are taking steps to advance the business and drive resilience to support long-term value creation across market cycles,” Eckert said.
Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
