Hurricane losses hit profits at BF&M
BF&M, the holding company of the BF&M Insurance Group, has reported shareholders’ net income for the three months ended 31st March 2017 of $6.0 million, a slight fall from the $7.1 million it made over the same period of 2016.
“2017 has begun with a solid earnings result for BF&M,” said president and CEO John Wight. “Core operating earnings in the first three months were lower than the same period in 2016 by $1.1 million, mainly due to the loss of profit commission as a result of the 2016 hurricanes. 2016 was the most active hurricane season that the Group has ever seen collectively.”
Gross premiums written for the period were $80.0 million, a decrease of 8 percent from the corresponding period of 2016 as a result of a reduction in fronting business. The company said that fronting business is generally fully reinsured and has little to no impact to the company’s bottom line.
Commission and other income increased from the prior year by 6 percent to $10.3 million due to a profit share increase on life business, partially offset by the negative impact of 2016 hurricanes on reinsurance profit commissions on property business.
Life and health policy benefits, which are recorded at fair value, decreased by 22 percent to $28.0 million, primarily as a result of a large fair value impact in 2016 of $11.2 million compared to $2.3 million in 2017. Finally, operating expenses increased by 3 percent to $16.3 million.
BF&M operates in Bermuda and 15 islands in the Caribbean and offers property and casualty products as well as health, life, annuities and pension products, and investment advisory services. The Group consists of four main insurance operating companies, BF&M General Insurance Company, BF&M Life Insurance Company, Island Heritage Insurance Company and the Insurance Corporation of Barbados.
BF&M Insurance Group, First quarter 2017 results, John Wight, Bermuda