Cat losses hit profits at XL but solid growth continues
XL Group enjoyed strong growth in 2016 boosted by the integration with Catlin Group but profits tumbled in what its CEO called a very challenging year characterised by increased levels of catastrophe losses.
The company’s net income fell to $440.9 million in 2016, a fall of 74.5 percent on the $1.2 billion it recorded in 2015.
It said the decrease was due largely to greater catastrophe losses incurred in 2016 as compared to 2015, citing Hurricane Matthew and the recent earthquake activity in New Zealand.
Natural catastrophe pre-tax losses net of reinsurance and reinstatement premiums for the year came to $636.3 million, almost triple the $213.2 million it reported in 2015. The company also saw its full year P&C combined ratio inch up slightly, from 92 percent in 2015 to 94.2 percent in 2016.
However, its gross written premiums came to $13.6 billion, up 28.3 percent on the $10.6 billion it recorded in 2015.
Integration costs related to the combination with Catlin Group totalled approximately $220.4 million for the full year.
Mike McGavick, CEO of XL Group, said: “2016 was undoubtedly a challenging year. Our results were impacted by both a disappointing start as well as a number of significant catastrophe losses throughout the year and in the 4th quarter in particular.
“At the same time, as the year developed, our underlying strengths continued to emerge. For example, our grinding focus on efficiency and underwriting quality produced a lower expense ratio and an improved loss ratio excluding catastrophes. We were even able to grow a bit - bolstered by our new market presence our 4th quarter P&C net premium earned, for example, was up 3.3 percent over the prior year quarter.
“All in, we feel we took important steps in the year and, despite challenging market conditions, are very much looking forward to 2017.”
Did you enjoy reading this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
Already registered?
Login to your account
If you don't have a login or your access has expired, you will need to purchase a subscription to gain access to this article, including all our online content.
For more information on individual annual subscriptions for full paid access and corporate subscription options please contact us.
To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.
For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Elliot Field at efield@newtonmedia.co.uk or Adrian Tapping at atapping@newtonmedia.co.uk
Editor's picks
Editor's picks
More articles
Copyright © intelligentinsurer.com 2024 | Headless Content Management with Blaze