Aspen sees Q1 2018 profits tumble by two-thirds
Aspen Insurance Holdings has seen its first quarter 2018 net income after tax fall to $30.8 million, a third of the $96.5 million it reported for the same quarter of 2017.
However, the company also saw gross written premiums for the quarter increase by 11.9 percent, hitting a new high of $1.11 billion, compared with $998.0 million in the first quarter of 2017.
“The first quarter of 2018 was the first in Aspen's history in which we wrote more than a billion dollars of premium,” said Chris O’Kane, chief executive officer. “Our strong results include gross written premium growth across both Aspen Re and Aspen Insurance as a result of our targeted growth strategy. Both segments generated underwriting profits, we improved our total expense ratio and we continue to implement our operational effectiveness and efficiency program.”
Aspen’s insurance segment reported gross written premiums of $493.3 million for the quarter, an increase of 14.0 percent compared with $432.7 million in the first quarter of 2017, due primarily to growth in the financial and professional lines and property and casualty sub-segments.
Its reinsurance segment reported gross written premiums of $623.5 million, an increase of 10.3 percent compared with $565.3 million in the first quarter of 2017. Aspen said that its specialty sub-segment premiums increased largely due to growth in agriculture business which included a fronting arrangement written as part of the transitional arrangements following the sale of AgriLogic in 2017 while the property catastrophe sub-segment premium increase was largely driven by rate improvement.
Net written premiums came $635.5 million in the first quarter of 2018, a decrease of 7.4 percent compared with $686.2 million in the first quarter of 2017 as Aspen said that it continues to make increased use of ceded reinsurance to seek to reduce volatility.
Looking at this in more detail net written insurance premiums came to $210.5 million, a decrease of 11.6 percent compared with $238.0 million in the first quarter of 2017, due primarily to increased use of quota share reinsurance to seek to reduce volatility.
Net written reinsurance premiums were $425.0 million, a decrease of 5.2 percent compared with $448.2 million in the first quarter of 2017. Net written premiums in the first quarter of 2018 reflect a change in accounting treatment of cessions related to Aspen Capital Markets and, in addition, continued to be impacted by transitional changes to ceding of premiums following the sale of AgriLogic.