Bermuda insurer turns first quarter profit

Bermuda insurer BF&M Limited turned a $10.5 million profit in the first quarter of 2023, reversing a $3 million loss in the same period in 2022.

BF&M, which may see rival Argus buy a 30% stake in the company, said the result was driven by rate increases, improved underwriting and the recovery in the investment markets.

Abigail Clifford (pictured), group president and chief executive officer, stated: “BF&M had a good start to the year. It was a strong quarter for our P&C business, as we continue to drive rate increases and initiate a more selective approach to underwriting risks.

"It was also a positive quarter for our pensions and annuity operations, capitalising on more favourable market conditions.

"Furthermore, investment markets continued their rebound and higher interest rates are beginning to show through into improved core investment income.

"We continue to experience higher loss trends in our Group Health business, due to complex cases requiring out of country treatment. However, we are working closely with our partners to control cost while ensuring our clients receive the best-in-class coverage they can expect with BF&M.”

Clifford noted that the first quarter results were the first reported under IFRS 19 and IFRS 9, which are new accounting standards for insurance contracts and the measurement of financial assets.

The company said equity attributable to shareholders on 31 March 2023, was $295.4 million. General fund assets totaled $947.4 million, of which $107.4 million was held in cash and cash equivalents.

The Company’s combined insurance service and net investment result under IFRS 17 was $20.2 million versus a loss of $17.7 million in Q1 2022 as restated, driven by higher core investment income, increases in bond and equity assets and an increase in profit commissions on certain reinsurance contracts.