Hong Kong domiciled reinsurer Peak Reinsurance Company Limited (Peak Re) reported net profit of $19.5 million for 2018 as its earnings were impacted by several large natural catastrophe events.
The reinsurer’s combined ratio for the year was 98.3%, with 2018 representing the sixth consecutive year of growth for the company despite a challenging environment.
Peak Re generated gross premium income of $1.38 billion for the year and recorded total assets of $3.75 billion.
It also reported total investment return of 2.7%, with a solvency adequacy ratio of 432% and a management expense ratio of 3.56%.
“We are extremely proud that after six years of operations, we have successfully established a strong footing in the industry as a significant global player,” said Franz Josef Hahn, Chief Executive Officer of Peak Re.
“2018 is a defining year for Peak Re,” Hahn added. “In spite of the multiple severe natural catastrophes, including Japan’s Jebi and Trami and two significant hurricanes in North America — Florence and Michael — and wildfires in California, Peak Re managed to achieve remarkable results.”
Peak Re completed its first full year of business in India in 2018, with additional support from Hong Kong’s signing of a double taxation agreement with India, which allows the reinsurer to write business from Hong Kong cost-efficiently on its one-underwriting platform.
China also remains a key market for Peak Re as the company took steps to shore up its business strategy and underwriting policies for the region last year, boosted by an agreement between the China and Honk Kong regulators to give equivalent status to reinsurers in Hong Kong.
Southeast Asia, which Peak Re operates in through a branch in Labuan and as an authorised reinsurer in Singapore, also forms a key part of its strategy, and the company expanded its Asia footprint by establishing a representative office in Japan in 2018.
In 2018, Peak Re launched the first reinsurance sidecar transaction in Asia, raising $75 million of collateralised retrocession from private investors via its Bermuda-domiciled special purpose insurer, Lion Rock Re Ltd.
Hahn continued: “At Peak Re, we have a clear purpose: to support the needs of communities and emerging middle class society through meeting reinsurance needs in Asia and around the globe.”
“With this purpose, supported by our people who are collectively entrepreneurial and courageous, agile and with deep insights, we’re well positioned to capture the great potential and leverage the positive momentum in our key markets,” he explained.