Re/insurer Lancashire posted a fall in profits and premiums in the third quarter of 2015.
The re/insurer, which operates through its London and Bermuda-based subsidiaries, reported a fall in profits to $34.1 million in the third quarter of 2015, compared with $37.6 million in the third quarter of 2014.
Its gross written premiums (GWP) slipped 20.8 percent to $120.4 million in the quarter, compared with $152.1 million in the same period of the prior year.
This was driven by contractions in Lancashire’s property, energy, marine and Lloyd’s segments of 19.8 percent, 39.8 percent, 56.9 percent and 7.2 percent respectively.
“The decrease in premiums for the quarter and year to date came primarily from the property and energy segments where a number of multi-year deals written in 2014 are not yet due to renew,” explained the re/insurer.
However, its aviation segment posted GWP growth of 8.1 percent in the quarter, driven by new business in the aviation satellite book.
Lancashire’s combined ratio improved to 70.2 percent in the third quarter of 2015, compared with 82.4 percent in the same period of the prior year.
Alex Maloney, chief executive officer of Lancashire, said: “Our principal strategic objective is to generate attractive risk adjusted underwriting returns over the course of the market cycle.
“Underwriting is what we understand and what we do best. We do not subscribe to the model, used by some in our industry, of ramping up risk on the investment side when underwriting conditions and returns remain depressed.
“I believe that in the current market the most important priority remains to focus on disciplined underwriting, adding value for our clients and brokers (many of whom are themselves facing challenging times) and thereby maintaining and servicing with excellence a core book of business.”
He added: “Premiums are down for the quarter – in line with experience across the market and as I would expect. In the current market one has to question the wisdom of driving for top line growth. I take comfort in this environment that the Group, across its Lloyd’s, London and Bermuda businesses, continues to be relevant to the needs of our core clients and brokers.”
Lancashire, Bermuda, London Market, Third Quarter 2015 Results, Alex Maloney