Lancashire GWP improves by 9%

Lancashire Holdings benefited from a surge in property reinsurance underwriting to record a 9% increase in gross written premiums through the first nine months of the year. 

The Bermuda-based re/insurer said in its trading statement that GWP increased to $1.7 billion compared to the same period in 2023 while  insurance revenue increased 16.8% to $2.98 billion in the same period as prior period positive developments added to earnings. 

The company said net losses from natural catastrophes in the third quarter and Hurricane Milton in the fourth quarter were expected to be between $110 million and $140 million but should not affect its return on equity guidance .

Lancashire's combined ratio was expected to come in at the higher end of the projected range. 

The company reported an investment return of 5% while managed investments increased to $3.2 billion from $2.7 billion at September 30, 2023.  

“I am pleased to report that Lancashire is in excellent shape as we approach the final months of 2024,” said Alex Maloney, group chief executive officer. “Over the past few years, we have successfully made our business more resilient to withstand volatility and deliver more sustainable returns for investors. We expect to deliver in line with our ROE guidance for the year.” 

He added: “The devastation caused by the recent weather events in the U.S. and other catastrophes has been tragic and our thoughts are with all those affected. Instances like these show the value of re/insurance products in supporting communities to help them rebuild after major catastrophe events. 

“In the year-to-date, the industry has seen an elevated catastrophe and risk loss environment, but we still expect our undiscounted combined ratio to be at the higher end of our range for the full year. This is testament to our diversification strategy, and the quality of the business we have written.”

Maloney said that as a result of the company’s strong performance, it would issue a special dividend of 75 cents a share, resulting in a payout to shareholders of $180 million. 

“We continue to hold an extremely robust capital position to underwrite the growth opportunities we expect to see in 2025,” he said. “Lancashire’s long-term strategy has always been to actively manage the market cycle and deliver strong profitability by taking advantage of opportunities in positive underwriting conditions. We will continue to do that during the remainder of 2024 and into 2025.”

The company’s reinsurance GWP rose 12.4% to $941 million through the first nine months of the year while the insurance segment recorded a 5.1% increase to $759 million. 

Reinsurance insurance revenue rose 20.6% to $629 million while the insurance segment recorded a 13.4% rise to $668 million. 

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