Argo Group International Holdings, Ltd. has reported net income of $27.2 million for the first quarter of 2021 against a net loss of $24.7 million a year earlier, despite elevated catastrophe losses during the period.
At the same time, Argo has reported an increase in operating income from $12.5 million in Q1 2020 to $15.5 million in Q1 2021.
Net investment income also improved for the company during the period, from $35.6 million to $44.4 million.
While gross written premiums declined by more than 8% to $756.5 million in Q1 2021, net written premiums and earned premiums both improved to $421.3 million and $466.1 million, respectively.
Overall, Argo has announced an underwriting loss of $17.9 million for the opening quarter of 2021 against a loss of $14 million for the same period in the prior year, as the combined ratio weakened slightly to 103.8% on the back of higher catastrophe losses.
Total catastrophe losses reached $47.5 million for Argo in the period. Natural catastrophe losses accounted for the bulk, or $43.1 million of the total and $4.4 million was related to the ongoing COVID-19 pandemic.
The majority of Argo’s nat cat losses in the quarter were driven by the impacts of winter storm Uri in February in the U.S.
Roughly $7 million of the reported nat cat losses in the current quarter related to Argo’s remaining exposures to Ariel Re for 2020 and prior open years of account.
“We are pleased with the improved underlying combined ratio of 93.4% during the quarter, which was our strongest result since 2016,” said Argo Chief Executive Officer (CEO), Kevin Rehnberg.
“We believe the improvement in underwriting results this quarter is further evidence that the actions we have taken over the last two years are the right ones. This positive momentum is supported by our expense focus and positions us to take advantage of market opportunities and execute on our targeted growth strategy.
“While the first quarter included elevated catastrophe losses, we have made good progress on reducing our property exposure. We expect the majority of our targeted actions to be completed ahead of U.S. wind season. This will reduce our exposure to future events.”
