Brit posts first half 2018 profit despite challenging market

Brit has announced that it made a first half 2018 net profit of $12.9 million, down significantly from the $139.7 million it made over the same period of 2017.

However, the company announced that gross written premiums for the period were $1.15 billion, up 5.3 percent from the equivalent 2017 figure of $1.09 billion.

The company also reported premium rate increases of 3.5 percent, an improvement on 2017’s decreases of 2.2 percent). Net earned premium came to $783.5 million, an increase of 3.4 percent from the 2017 total of $740.7 million.

The company also noted that the first half of 2018 included the successful 1 January 2018 launch of Bermuda-based Sussex Capital, the open-ended fund which writes through Sussex Re, providing direct collateralised reinsurance and collateralised reinsurance to Brit’s reinsurance portfolio. The half also saw the successful completion and expansion of the fourth annual Versutus Series Notes, offering continued access to Brit’s strong underwriting franchise.

“Following the major losses of 2017, we have achieved overall risk adjusted premium rate increases of 3.5 percent in the period, primarily driven by the loss affected property, treaty and marine classes, in both our London and US portfolios,” said Matthew Wilson, group chief executive officer of Brit. “While these rate increases are welcomed, they are lower than initially anticipated as capacity continues to exceed demand and brokers move business to new carriers at current or reduced rates.  In this challenging environment, we have continued to take action to protect our balance sheet, with the application of rigorous risk selection criteria in marginal classes and the decision to withdraw from certain classes such as international professional indemnity and general aviation.

“While the rating environment in 2018 has been more positive, the outlook for the remainder of 2018 remains challenging. However, we continue to focus on our core fundamentals of underwriting discipline, risk selection and capital management. We have a clear strategy and have established a strong platform with a well-balanced business mix. This, supported by Fairfax as our parent, continues to position us well in the current rating and low yield environment.”