The Association of Bermuda Insurers and Reinsurers (ABIR) has released last year’s global underwriting results for its 21 member firms, showing it’s been a successful year for the group, which enjoys a loss ratio decrease by 9.1 % compared with 2015.
The 21 re/insurers reported net income of $10.2 billion in their global businesses, up a significant 15% from 2015’s $8.7 billion.
Bradley Kading, President and Executive Director of the ABIR, commented on the group’s performance; “While soft market conditions prevail, the resilience of the members is demonstrated by their robust underwriting results.
“Members continue to seek new markets in the developed and developing world to put risk capital to work. ABIR members continue to be focused on reducing expenses and exploring new product opportunities.”
While these encouraging figures show a year of peak performance and strategic management of underwriting and investment capacity, the ABIR president pointed to changes to the group that have impacted the underwriting report; three new members joining the group and several members completing significant acquisitions during the reporting period.
ABIR’s member re/insurers collectively wrote $92 billion in global gross written premium on a capital and surplus base of $123.6 billion last year, a 27% increase from 2015’s $72 billion global gross written premium.
The gross premium to equity ratio for the group came to .75 to 1, reports ABIR.
During 2016 ABIR members recorded a combined ratio of 79.3%, compared with 89.3% a year earlier. While investment income also increased for the group, from roughly $5.9 billion in 2015 to $7.1 billion in 2016.
Kading, however, largely attributed the aggregate growth in premium and surplus to a combination of the new members and existing members’ M&As – however, these new additions indicate that as a re/insurance domicile, Bermuda has withstood increased competition to remain an attractive option for the sector.
Kading said, “As a representative of global risk underwriters, in its public policy work ABIR focuses on the consumer benefits of increased capacity and reduced price that result from the ability to diversify global risk onto a flagship balance sheet.
“Protectionism in regulatory or tax public policies harms the ability of these global (re)insurers to diversify risk and thus makes insurance markets less competitive,” he added, warning against rising signs of protectionism on a global scale, which could hinder the rapid speed of innovation and development throughout the re/insurance industry and have a knock on impact of reduced insurance penetration growth in regions of the world, where with growing risks, its needed now more than ever.
