Allied World, the Swiss-based re/insurer with Bermuda offices, posted a drop in profits for the second quarter of 2015, driven by catastrophe losses and mark-to-market losses.
The re/insurer’s profits fell to $9.5 million in the second quarter, compared with $151.9 million in the second quarter of 2014.
This was driven by $25 million of catastrophe losses related to the New South Wales storms, non-catastrophe weather and fire-related losses of approximately $20 million, and mark-to-market losses on investments of $60.1 million.
Despite this, gross written premiums (GWP) jumped 8.6 percent to $826 million in the second quarter of 2015, compared with $760.4 million in the same period of the prior year.
Allied World’s global markets insurance segment was the main driver of growth: GWP grew 83.5 percent driven by the inclusion of the acquired Asian operations for the first time and 7.7 percent excluding the impact of the acquired Asian operations results.
Its North American insurance segment also posted a hike in GWP of 9.6 percent, driven by growth in its defence base act, excess casualty and environmental lines. This was partially offset by a continued decrease in the healthcare line, where GWP decreased 16.8 percent compared to the prior year quarter and 30.1 percent compared to the same quarter two years ago.
Offsetting the growth in the two insurance segments was a 19.1 percent decrease in GWP in the reinsurance segment driven by the non-renewal of several casualty and property treaties.
Allied World’s combined ratio deteriorated to 99.2 percent in the second quarter of 2015, compared with 90.3 percent in the second quarter of 2014.
Scott Carmilani, president and chief executive officer of Allied World, said: “While we are excited to report our first quarter inclusive of the results of the recently acquired Asian operations, unfortunately this quarter’s results were impacted by catastrophe and current year events. “We continue to take steps to grow attractive insurance businesses, and look to manage our growth while mitigating exposure to less attractive risks.”
Allied World, Bermuda, Europe, Second Quarter 2015 Results