Sirius & OneBeacon drive down profits at White Mountains
OneBeacon and Sirius drove down the profits of parent company, White Mountains Insurance Group, in the second quarter of 2015.
The firm reported profits of $4.3 million in the second quarter of 2015, compared with $95.5 million in the second quarter of last year.
The reinsurance segment of White Mountains, Sirius, reported pre-tax income of $6.8 million for the quarter, compared with $76.7 million for the same period of the prior year.
It posted an increase in its top line however, as gross written premiums rose 7 percent to £256.2 million in the quarter this year, compared with $238.6 million in the same period of last year.
Its combined ratio improved by 3 percentage points to 78 percent for the second quarter of 2015, compared with 81 percent for the second quarter of last year.
OneBeacon’s net written premiums hit $321.2 million in the second quarter, compared with $259.9 million in the second quarter of 2015, while its combined ratio improved 4 percentage points in the quarter, compared with 99 percent in the second quarter of 2014.
The segment reported pre-tax income of $2.9 million for the quarter, compared with $31.7 million for the same period of the prior year.
Despite the firm’s poor results, Ray Barrette, White Mountains Insurance Group chairman and chief executive officer (CEO) remained optimistic.
He said: "It was a solid quarter. Sirius Group reported a 78 percent combined ratio continuing its long track record of success. We announced separately this morning that we have signed a definitive agreement to sell Sirius Group for about 127 percent of book value in cash.
“Excluding currency effects, results were slightly negative. Currency translation benefited the quarter by $5 per share, but cost $3 per share through six months. Our insurance services businesses continue to do well but currently have little impact on our reported results."
Allan Waters, CEO of Sirius Group, added: ”Our 79 percent combined ratio for the first six months benefited from low catastrophe activity and more good news from prior years' loss reserves.
“Excluding currency effects, Sirius Group's adjusted book value per share grew 3 percent over the first six months. Gross written premiums in local currencies were up 10 percent in the quarter and 3 percent from the first six months of last year, driven principally by growth in our primary US accident and health business.”
Mike Miller, CEO of OneBeacon, said: ”We are pleased to report solid underwriting results for the second quarter and first half of the year. Through six months, we achieved 3 percent growth in book value and a 95 percent combined ratio.
“We reported strong written premium growth mostly driven by our newer segments in a marketplace that is competitive, but still supporting reasonable rate increases."