Everest rides hard market to $678m third quarter profit

Everest Group executed a more than $950 million turnaround in the third quarter, rebounding to a $678 million profit from a $319 million loss in the same period in 2022.

Everest achieved the rebound as gross premium written premium jumped 23.4% to $4.4 billion and it achieved a combined ratio of 91.4%

Underwriting net income for the period was $301 million compared to a $367 million loss in 2022 while net investment income soared from $151 million in 2022 to $406 million.

The company also recorded pre-tax Catastrophe losses of $170 million compared to $730 million in 2022.

“Everest’s third quarter performance was excellent,” said Everest president and CEO Juan C. Andrade. “We delivered outstanding returns including a near 20% operating return on equity and an annualized 25% total shareholder return.

“We are leaning into the hard reinsurance market, where favourable conditions and the global flight to quality persist. As a lead market and preferred partner, we are well-positioned for the upcoming January renewals. We continue to expand our global reinsurance portfolio at significantly improved risk adjusted returns.

“In addition, our primary insurance business continues to generate strong and consistent underwriting income, with a significant year-over-year improvement.

“Supporting the strong underwriting performance of our two businesses, our high-quality investment portfolio continues to deliver outstanding returns, generating over $400 million in net investment income in the quarter, and over $1 billion year-to-date. We have significant momentum heading into the final quarter of the year, with strong tailwinds and exceptional talent powering our disciplined execution and industry-leading shareholder returns.”

In the reinsurance segment, Everest said its gross written premiums grew 32.7% to $3.2 billion while net written premiums were $3 billion, up 22.3%.

Growth was broad-based across all lines, but was led by property pro-rata, which was up 43.9% while property catastrophe excess of loss was up 41.2%.

Casualty excess of loss and casualty pro rata were up 28.8% and 19.9% respectively, with Everest saying price increases and a “flight to quality” globally were underway.

Everest said catastrophe reinsurance was up 30% with improved terms and conditions.

In the insurance segment, gross written premium rose 3.5% to $1.2 billion and the underwriting profit was $66 million, with Everest saying pricing continued to exceed the loss trend.