Maiden targets 2018 profits after 2017 losses
Bermuda-based Maiden Holdings made a net loss of $133.6 million in the fourth quarter of 2017 a deterioration on the net loss of $74.7 million it reported in the fourth quarter of 2016.
The company said that net adverse loss reserve development in the fourth quarter of 2017 totalled $171 million from the workers’ compensation line of business in the AmTrust reinsurance segment and from two accounts in run-off in the commercial auto line of business within the diversified reinsurance segment.
The quarterly figures contributed to Maiden’s full year 2017 net loss of $199.1 million, a severe fall from the profit of $15.2 million it made in 2016. The non-GAAP net operating loss for 2017 was $184.9 million, compared with non-GAAP operating income of $17.3 million in 2016.
In 2017, gross premiums written totalled $2.8 billion, relatively unchanged compared to 2016. In 2017, net premiums written totalled $2.8 billion, an increase of 4.0 percent compared to 2016. Net premiums earned of $2.7 billion increased 6.4 percent compared to $2.6 billion in 2016.
Maiden’s combined ratio for 2017 was 111.3 percent, an increase from the 103.2 percent combined ratio reported for 2016.
Net investment income of $166.3 million in 2017 increased 14.0 percent compared to $145.9 million in 2016 due to an increase in investable assets and incrementally higher portfolio yields.
“While we are disappointed with our results for the fourth quarter, we believe we have taken significant steps to strengthen our reserves for losses which will help to accelerate a return to profitability in 2018 and beyond,” said Art Raschbaum, chief executive officer of Maiden. “Our reserve actions in the fourth quarter reflect a more aggressive response to observed development in the quarter and throughout the year on the AmTrust reinsurance segment as well as our diversified segment. Despite these actions, Maiden’s inception to date AmTrust underwriting results remain profitable and with the exception of pre-2016 underwriting year commercial auto liability the balance of our US diversified segment historical portfolio and more recent underwriting years continue to perform profitably and within expectations.”
“Notwithstanding the reserve actions and re-underwriting processes that have been implemented, we are also actively engaged in efforts to develop and implement further initiatives and strategies aimed at strengthening shareholder value,” concluded Raschbaum. “We are committed to do whatever is necessary to deliver greater value for shareholders, customers, and employees.”
