In its nine month results, Lancashire Holdings Limited has reported that gross premiums written increased by 23.2% year-on-year to $1.6 billion, while IFRS 17 insurance revenue increased by 22.1% to $1.1 billion.
Of the total gross premiums written, the reinsurance segment accounted for $837.7 million, while the insurance segment accounted for $722.2 million.
Speaking on the reinsurance segment, Lancashire said that the build-out of its casualty reinsurance lines continued to be the most significant contributor to growth.
The firm continued, “Our specialty reinsurance class also continued to add new business in a positive rating environment, with the property reinsurance class also benefiting from significant rate increases. Overall the RPI was 123% for the segment.”
Meanwhile, Lancashire noted that the growth in the insurance segment was primarily driven by property insurance, with significant rate increases in the property direct and facultative class and the continued build-out of the property construction book of business.
In specialty insurance, the firm underlined that more premium was written in the political risk class, and energy and marine continued to grow across its underwriting platforms, taking advantage of positive market conditions across most classes.
Highlighting the specifics of the loss environment, Lancashire said, “The first nine months of 2023 has seen natural catastrophe loss activity across a number of events including U.S. wind and convective storms, the Hawaiian wildfires, the Turkey earthquake, hurricane Idalia, and cyclones and flooding in New Zealand.
“We also incurred some risk losses, particularly in our energy classes. These losses were not individually material.”
Alex Maloney, Lancashire Group Chief Executive Officer, commented, “During the first nine months of 2023, we have continued to successfully implement our long-term strategy to manage the market cycle and deliver strong profitable growth through a portfolio of diversified products/
“We continue to expect a positive environment into 2024, with further opportunities for Lancashire. Our investment returns have also continued to benefit from the higher interest rate environment and the short duration of our portfolio, with a total net investment return, including unrealized gains and losses, of 2.8% for the period.”
Maloney continued, “Capital management and balancing risk and return have for a long time been at the heart of our strategy, and we continue to hold an extremely robust capital position. Our disciplined underwriting, and successful diversification strategy, mean that we are in a position to pay out some of the capital generated to date, and still have the flexibility to fund further growth and realize our ambitions for this phase of the market cycle.
“Following the strong operating performance in the year-to-date, I am pleased to report that the Board has approved a capital return of up to $169 million, including $119 million in special dividend and up to $50 million in buy-backs.”
He concluded, “Our previously announced plans to expand our international footprint further through Lancashire Insurance U.S. continue, and we are pleased with the progress we are making towards an underwriting launch in early 2024.
“I am always impressed by the talent, hard work, and dedication of our people across the Lancashire Group, and I would like to thank them for their ongoing commitment to the business. I would also like to thank our clients, brokers, and shareholders for their continued support.”
