Assurant, Inc. recorded improved net income of $161 million in the first-quarter of 2019, with higher earnings reported across its business segments.
Net operating income of $140.6 million improved 31% in Q1 2019 when compared with the same period in 2018, and excluding reportable catastrophes improved by 30%, to $148.8 million.
The higher operating income is a result of contributions from recently acquired TWG Holdings and also mobile organic growth in Global Lifestyle.
The firm experienced reportable catastrophe losses of $8.2 million in the period, which is up on the $7.4 million reported a year earlier. The catastrophe hit relates to winter weather which impacted Assurant’s Global Housing segment by $8.8 million, but despite this, the segment reported a 2% increase in operating income to $72.7 million.
“Excluding mortgage solutions in the prior year period, earnings declined as growth in multifamily housing was offset by higher catastrophe reinsurance costs, and decreased profitability in specialty property offerings,” explains Assurant.
Net earned fees, premiums and other income across the Global Housing, Global Lifestyle and Global Preneed segments totalled $2.23 billion, up significantly from the $1.49 billion reported in Q1 2018.
Assurant states that this increase reflected $651 million of revenue from TWG Holdings, which it acquired last year.
The Global Lifestyle segment saw its operating income increase by a substantial 80% year-on-year, to $100.6 million, which again reflects the TWG acquisition and also organic growth in Connected Living.
Global Preneed recorded operating income of $11 million in the first-quarter of 2019, up 20% on the same period last year, primarily a result of higher investment income and lower mortality in the period when compared with a year earlier.
Corporate & Other again reported a net loss in the first-quarter, of $24.1 million. However, this is an improvement on the prior year first-quarter, which Assurant says is a reflection of lower employee-related expenses.
“Our first quarter results represent a strong start to 2019, driven by contributions from our acquisition of TWG and organic mobile growth. In addition to the significant increase in Global Lifestyle earnings, we also saw higher income from our Global Housing and Global Preneed segments.
“As we outlined at our 2019 Investor Day, we believe we’re well positioned to sustain outperformance over time, driven by our leading positions and innovative offerings which should support double-digit earnings growth and significant cash flow generation,” said Assurant President and Chief Executive Officer (CEO), Alan Colberg.
Looking forward, and Assurant expects operating income, excluding catastrophes, to increase 6% to 10% in 2019 when compared with the previous year. The main driver of this is expected to be profitable growth in Global Lifestyle and Global Housing, and also share repurchasing.
In addition, and to reflect a full-year of contributions from TWG, Assurant expects to record double-digit earnings growth in the year.