Bermuda-based insurer and reinsurer, AXIS Capital Holdings Limited, has reported a net loss of $5 million and an operating loss of $16 million for the fourth-quarter of 2020.
The net result is an improvement on the $10 million net loss posted by the firm for the same period in 2019, while the operating loss compares with operating income of $4 million in Q4 2019.
During the quarter, pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums, totalled $198 million. Of this, $118 million relates to the firm’s insurance segment, while $80 million relates to reinsurance business.
Included in this loss amount is a net claims estimate of $125 million attributable to the COVID-19 pandemic, which AXIS notes is in addition to the estimate of $235 million recognized in the first quarter of 2020.
Additionally, other catastrophe and weather-related losses reached $73 million in Q4 2020, attributable to Hurricanes Zeta and Delta and other weather-related events.
The re/insurer also experienced net favourable prior year reserve development of $7 million in the quarter, against $14 million in 2019.
Turning to premiums, and AXIS has reported that gross written premium increased 7% to $1.3 billion for the fourth-quarter, while net premiums written actually declined slightly to $785 million.
Both AXIS’ insurance and reinsurance segments fell to an underwriting loss in the fourth-quarter of 2020, as the company reports a combined ratio of 109.6%, compared with 107.3% for the same period in 2019.
Albert Benchimol, President and Chief Executive Officer (CEO) of AXIS, commented: “This was a year of tremendous challenge. First and foremost, our thoughts are with the people and families afflicted by COVID-19 and those whose lives were upended by extreme weather. For our business, the combined impact of the pandemic which affected both our underwriting and investment results and elevated hurricane activity that made 2020 the fifth costliest cat year on record, led to disappointing financial results that overshadowed significant underlying progress.
“In 2020, AXIS materially strengthened our core performance, highlighted by a year-over-year improvement of 4.6 points to our current accident year combined ratio ex-cat and weather. This progress in our underwriting metrics demonstrates that all of the work that we’ve done in recent years to reposition our portfolio and drive targeted growth in our most attractive markets is delivering tangible results.”
For the full-year 2020, AXIS has reported a net loss of $151 million and an operating loss of $174 million, compared with net income of $282 million and operating income of $213 million, respectively, in 2019.
In 2020, pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums, totalled $774 million, split $443 million insurance and $330 million reinsurance. This includes $360 million of losses attributable to the pandemic. Additionally, AXIS recorded other catastrophe and weather-related losses of $414 million during the year.
Net favorable prior year reserve development reached $16 million in 2020 against $79 million in 2019.
“In addition, I’m proud of our team for stepping up in the face of adversity. We never missed a beat in delivering excellent service and claims support to our clients – and we stayed true to our values, supporting our people, customers, and communities,” continued Benchimol.
“We begin 2021 with positive momentum and confidence. We have great talent, deep relationships with our clients and partners in distribution, a strong and balanced book of business, and leadership positions in markets that are seeing the most meaningful pricing corrections. With all of the progress that’s been achieved, we’re confident that we will see profitable growth and continued improvement in our underwriting and profitability – and we are focused on delivering value to our shareholders,” he added.