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Greenlight Re returns to underwriting profitability

4th August 2021 - Author: Katie Baker

Greenlight Capital Re has reported its Q2 2021 financial results, showing an underwriting income of $4.562 million compared to a loss of $1.306 million for the prior year period.

Greenlight-ReIts combined ratio came in at 96.5%, an improvement from 101.2% last year. The higher underwriting income was due primarily to the 2020 period being negatively impacted by COVID-19 pandemic losses.

This increase was partially offset by losses recognised during the 2021 period, including those connected with the Texas winter storms that occurred in February, 2021 and deposit-accounted contracts.

Greenlight also reported its gross written premiums in Q2 were $141.6 million, compared to $116.7 million in the second quarter of 2020.

This increase relates primarily to business assumed from various Lloyd’s syndicates, which was partially offset by reductions in workers’ compensation, crop and health premium. Premiums ceded were insignificant in both periods.

RMS

The company also reported a total investment income of $2.0 million, compared to total investment income of $5.5 million in Q2 2020.

For H1, the total investment income came in at $20.7 million compared to an investment loss of $29.7 million incurred during the equivalent 2020 period.

The investment income for H1 was due primarily to a gains recognised in connection with Company’s strategic investments.

Additionally, the Company’s investment in the Solasglas fund generated a gain of $2.0 million for H1 2021, compared to a loss of $40.5 million during the same prior year period.

Simon Burton, Chief Executive Officer of Greenlight Re, said: “I’m pleased with the contribution from our underwriting business this quarter at a 96.5% combined ratio, although an otherwise excellent result was somewhat impacted by reserving actions on certain legacy contracts and COVID-19 losses.

“Our Innovations investments also performed well, as we booked a $4.0 million increase in valuations in this quarter, which represents a 15% increase over the carry values of these investments at March 31. Looking forward, I’m very optimistic for the prospects of both areas of our operations.”

David Einhorn, Chairman of the Board of Directors, added: “Our investment in the Solasglas fund had a small loss in the second quarter. The portfolio is positioned to take advantage of inflation and related equities which should exhibit pricing power in industries with structural shortages, which we think will more persistent than the consensus believes.”

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