Canadian property and casualty insurer and reinsurer, Fairfax Financial Holdings’ net earnings for Q2 2021 came in at $1.201 billion compared to $434.9 million for the same prior year period.
Meanwhile, gross premiums written by Fairfax’s re/insurance operations increased to $5.977 billion from $4.702 billion in Q2 2020.
The consolidated combined ratio came to 94.3%, producing an underwriting profit of $227.9 million. This compares to the unprofitable combined ratio of 100.4% which led to an underwriting loss of $13.3 million in 2020.
Prem Watsa, Chairman and Chief Executive Officer commented: “In the second quarter of 2021, all of our major insurance companies achieved a combined ratio well below 100%, with Northbridge and Zenith National leading the way at 84.7% and 92.7% respectively.
“Our consolidated combined ratio of 94.3% in the second quarter of 2021 included catastrophe losses of $138.4 million or 3.5 combined ratio points. Core underwriting performance continued to be very strong, with growth in gross premiums written of 27.1% and operating income increasing to $398.3 million, reflecting greatly reduced COVID-19 losses.
“Our investments increased significantly with net gains on investments of $1,290.2 million, primarily reflecting net gains on long equity exposures and $425.0 million on Digit compulsorily convertible preference shares.
“Mark-to-market movements on our non-insurance investments in associates and consolidated investments which are not reflected in our financial statements also increased in the second quarter of 2021 by approximately $338 million.
“As previously reported, upon closing of the Digit Insurance equity issuance in the third quarter, and upon final approval by the Indian government of its previously announced intention to increase foreign ownership limits, we anticipate recording an additional gain of approximately $1.4 billion or $46 in book value per basic share. We continue to focus on being soundly financed and ended the quarter with approximately $1.5 billion in cash and investments in the holding company.”