13 February 2020News

Lancashire reports increased profits for 2019

Lancashire Holdings saw profits increase year on year in 2019, in results that Alex Maloney, the group chief executive officer, described as “pleasing”.

Lancashire generated a net profit after tax of $117.9 million, up from $37.5 at the end of 2018.

Gross written premiums for the full year 2019 were $707.6 million, also up year on year, with the figure having been $638.5 million in 2018. Its combined ratio fell to 80.9 percent, down from 92.2 percent.

Maloney said the results reflected the measured pricing improvement across the insurance market, and Lancashire’s disciplined underwriting approach.

“These are pleasing results and are early evidence of the transition to the harder stage of the cycle within insurance markets,” Maloney said, before warning: “Further pricing improvement is needed in many lines of business before the market returns to a more sustainable environment.”

He said Lancashire’s strategy of underwriting predominantly short-tail lines had insulated the group from the reserving stress experienced in casualty insurance classes, while its reserving from prior year catastrophe events remains robust. However, he added: “These developments illustrate that there is still a need for a continued focus on underwriting discipline.”