31 January 2020News

Everest expects to post profits of around $1bn for 2019

Everest Re Group expects to report profits of around $1 billion for 2019, resulting in a net income return on equity of 12 percent.

This figure takes account of expected catastrophe losses, which Everest warned are likely to come in at around $215 million for Q4. Typhoon Hagibis contributed around $190 million of these losses, with tornado losses in Texas accounting for another $25 million. The catastrophe losses are net of estimated reinsurance recoveries and reinstatement premiums.

Meanwhile, higher than normal current year losses in the reinsurance crop book related to poor weather conditions in the US and Canada are also set to negatively impact underwritten income, by around $50 million.

Everest will report a net favorable prior year reserve development of $19 million, and net investment income of about $146 million, including lower limited partnership income of $6 million.

Rate improvement was strong in most classes of re/insurance in Q4 and the January renewals, Everest said. “The size, scale and financial strength of Everest, combined with a large and well diversified portfolio of business, is allowing the company to continue to capitalise on the favorable market conditions,” it said.

Full results for the quarter and 2019 year will be released on February 10.