Sirius 2018 results show losses despite ‘long-term wins’

Insurance group Sirius highlighted “long term wins” in its 2018 results, despite losses partly caused by typhoon Jebi.

The company reported net losses of $43.3 million in 2018, representing lower losses than in 2017, which were reported to be $156.1 million.

Gross written premiums were up 27 percent to $1.8 billion in 2018 compared with 2017. The company said this was driven by “top line growth in the specialty and casualty, and global property segments”.

The group’s combined ratio improved to 103 percent in 2018, from 108 percent the year before. Sirius said this was caused by lower catastrophe losses and partly offset by higher current accident year losses in certain segments.

Kip Oberting, president and CEO of the group, said: "Sirius Group accomplished a lot in the fourth quarter of 2018, and continues to evolve as a global reinsurance group with specialty insurance operations.

"We achieved a public listing, brought on four highly respected cornerstone investors, and added a group of highly qualified independent directors to our board. These long-term wins were unfortunately veiled by a financial loss during the quarter arising from storm losses and pockets of loss reserve development.”

However, he added: “Despite this recent volatility, we continue to build upon our unique franchise. We are pleased by the profitable growth in our global accident and health segment. Our investment in specialty growth initiatives are on track. Pie Insurance, where we have a minority investment and carrier relationship, is a particularly bright star as it embarks on its direct, data-driven roll-out of workers' compensation insurance. Lastly, despite recent high levels of global cat activity, our property reinsurance business remains core to our long term success. In this business, as in the others, we find honest, capable partners and clients. We treat one another fairly. Together we thrive. It's a long game."

Chief Financial Officer, Ralph Salamone, added: "During the quarter, we added $43 million to our typhoon Jebi reserves, bringing our total loss from the late third quarter event to $91 million, net of reinsurance and reinstatement premiums. We believe this now implies a market loss for Jebi is now in excess of $10 billion — twice the loss estimate that some market sources had suggested in September.

“On investments, the break-even total return in original currencies for the year is in line with our investment philosophy given market conditions where the performance of major equity and bond indices were negative."

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