Helios Underwriting, the Lloyd’s of London investment and underwriting vehicle, has announced the current mid-point forecasts for its portfolio of syndicate capacity for the 2020 and 2021 years of account, based on 4th quarter 2022 estimates.
The 2020 result showed an improvement over the midpoint forecasts as at 30th September 2022, although the overall result was impacted by negative investment returns recognised during the year and the impact from the COVID-19 pandemic.
The company, which acquires and consolidates private underwriting capacity at Lloyd’s, recorded a capacity position of £150.8 million for the 2021 year of account as at March 31st, 2023, versus £145.0 million at September 30th, 2022.
This updated figure consists of £99.3 million capacity retained by Helios and £51.5 million that is ceded to quota share reinsurers
Helios notes that the development of the mid point estimate for 2021 was held back by losses from Ukraine that were recognised in 2022, but says improved returns from the investment portfolio should benefit this year before it closes at the end of this year.
Meanwhile, for 2020, the company reported a capacity position of £121.2 million, versus an earlier estimate of £115.6 million, consisting of £72.0 million retained and £49.1 million reinsured.
Helios also stated that the 2022 underwriting year was impacted by the loss from Hurricane Ian that will create a drag on the earnings recognised in 2022.
Additionally, it says the outperformance of 2.2% of the portfolio against the average for the Lloyd’s market for 2020 continues the trend of closed year of account outperformance achieved since 2013.
“Helios’ unique proposition, as the only listed consolidator of private capital at Lloyd’s, is well positioned to benefit from the Lloyd’s market’s recently announced mid point forecasts,” said Chief Executive Martin Reith.
“Helios has built and curated an outstanding portfolio of the better performing syndicates and, as a consequence of underwriting discipline and judicious capital deployment, we are delighted to see improved underwriting profitability in the Lloyd’s market,” he added. “We expect Helios’ portfolio to continue to outperform the market as we have since 2013 for closed years of accounts.”
“Recognising stronger market conditions, we increased our retained capacity to £238m for the 2023 year of account, an increase of 34%,” Reith continued. “We remain confident that we shall deliver improved results and superior return on equity underpinned by our favourable Economic Capital Assessment (ECA), and look forward to creating further shareholder value as the benefits of the larger retained capacity flows to the income statement.”
