James River Group Holdings saw its combined ratios skyrocket amid mounting losses in the first quarter.
James River made a net loss of $103.5 million in Q1 2021, having made a loss of $36.8 million in the same period the previous year.
Its combined ratio expanded dramatically, to 199.2 percent, from only 100.6 percent the previous year, while its gross written premiums expanded to $373.3 million for the first three months of the year, up from $283.8 million the previous year.
Frank D’Orazio, James River’s chief executive officer, admitted the re/insurer had experienced higher than expected reported losses in its large commercial auto account in runoff, noting it had responded by changing its actuarial methodology, thereby strengthening reserves.
“We believe this overhang has been eliminated, and that we are now fully able to focus on our prospective business and what continues to be a historically strong E&S marketplace,” he said.
Meanwhile, James River has also commenced an underwritten public offering of approximately $175 million of its common shares.
As part of the deal, James River will grant the underwriters a 30-day option to purchase approximately $26 million of additional common shares.
The re/insurer will use the net proceeds for general corporate purposes.
Barclays and Keefe, Bruyette & Woods are acting as joint book-running managers for the proposed offering.
book-running managers for the proposed offering.
James River, Barclays, Keefe, Bruyette & Woods, Results