Milton to cost Everest up to $400m
Everest Group expects to record losses from Hurricane Milton and other catastrophes of up to $400 million in the fourth quarter.
The Bermuda-based re/insurer also said it was pivoting to underwrite property in its reinsurance and insurance segments, adding that conditions in the market remain favourable going into the January 1 renewals.
Everest chief executive officer Juan C Andrade made the comments as he released the company's third quarter results, which saw net income drop from $678 million to $509 million, although operating income improved from $613 million to $630 million.
“Everest delivered another successful quarter with strong operating income driven by solid underwriting results and healthy investment income," Andrade said. "These results reflect our underwriting discipline and prudent risk management, which position the Company to generate leading returns despite another above-average catastrophe year for the industry. We are delivering an annualized total shareholder return and operating return on equity of approximately 19%.
“As a lead reinsurance market, we grew in attractive lines of business with the highest expected returns. We are leveraging our franchise value in the continuing favourable property market conditions heading into the January 1 renewals.
"Additionally, we continued to shape our global primary insurance portfolio by growing strong double-digits in more attractive property and specialty lines, while remaining conservative across certain casualty lines in North America. As we approach the final stretch of the year, we remain focused on executing our strategy.”
Gross written premiums rose 0.8% from $4.39 billion to $4.42 billion while net written premiums slipped to $3.8 billion from $3.87 billion.
The company's combined ratio worsened to 93.1% from 91.4%. Underwritign income fell from $678 million to $509 million.
Pre-tax catastrophe losses were $279 million compared to $170 million in the same quarter in 2023.
Net investment income improved to $496 million versus $406 million in the prior year third quarter, driven by a larger asset base as well as strong core fixed income investment returns.
By segment, reinsurance GWP rose 1.7% to $3.26 billion and the combined ratio rose from 91.8% to 91.1%.
In insurance, GWP fell from $1.19 billion to $1.16 billion and the combined ratio jumped to 97.1% from 92.5%.
Investment income rose from $406 million to $496 million. Losses and loss expenses rose to $2.58 billion from $2.24 billion.
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