Bermuda-based Maiden Holdings has reported a net loss of $3.5 million for the third quarter of 2023, compared with net loss of $8.2 million in Q3’22.
It posted lower underwriting loss of $10.9 million in the third quarter of 2023, compared to an underwriting loss of $12.6 million in the same period in 2022.
This quarter’s underwriting loss includes adverse prior year loss development of $7.8 million in Q3’23 compared to adverse prior year loss development of $0.8 million during the same period in 2022.
Operating loss was $11.7 million for the third quarter of 2023 compared to operating loss of $21.1 million for the same period in 2022.
Net premiums written for the three months ended September 30, 2023 were $8.6 million compared to $5.2 million for the same period in 2022, due to lower negative cession adjustments in the third quarter of 2023 for the AmTrust Reinsurance segment.
Net investment income increased by $2.4 million or 36.3% for the three months ended September 30, compared to the same period in 2022, primarily due to higher annualised average book yields from fixed income assets which increased to 4.3% for the three months ended September 30, 2023 compared to 2.2% for the same period in 2022, the company noted.
There were also net realized and unrealized investment gains for the three months ended September 30, 2023 were $0.2 million compared to net losses of $1.6 million for the same period in 2022.
Patrick J. Haveron, Maiden’s Chief Executive Officer commented on the third quarter of 2023 financial results: “Continued increases in our investment results were offset by a higher underwriting loss during the third quarter, primarily due to adverse loss development in both of our segments.”
“The continued improvement in our investment performance was principally the result of significantly higher investment income as our floating rate and adjustable-rate securities responded to the continuing rise in interest rates, with limited impact on asset values. Net investment income increased by $2.4 million or 36.3% compared to last year’s third quarter, and with 37.8% of our fixed income investments now in floating rate securities, our results could benefit further if additional increases in interest rates occur. Our alternative asset portfolio continues to make contributions as we recognised income on several of our equity method investments during the quarter as well,” Haveron added.
“The rise in interest rates and subsequent economic and financial markets uncertainty continues to lead to a more measured pace of deployment of new alternative investment opportunities, and we are adjusting our investment focus accordingly, by seeking income producing, lower risk assets at more attractive yields. Against this market backdrop, particularly as regards to timing of monetising certain investments, we believe our alternative investment portfolio remains well positioned to achieve its targeted longer-term returns.”
“During the third quarter, we continued our long-term capital management strategy and repurchased 520,475 common shares. We expect to continue a disciplined and prudent approach to share repurchases as part of this program.”
“Our underwriting loss in the third quarter was primarily the result of adverse development in our AmTrust segment. During the third quarter, Hospital Liability experienced adverse loss development of $6.0 million as losses prior to 2016 emerged, which is not covered by the LPT/ADC reinsurance we have in place. In addition, more modest adverse development in other lines occurred, principally Auto Liability and Specialty programs.”
“We continue to respond to the emergence of this additional loss data as it is reported. Loss development in our Diversified segment was again primarily from a German auto program in run-off from our IIS unit along with smaller development from a variety of older treaty programs.”
“We continue to actively evaluate our strategies as we look to build a more consistent base of revenue and profits while leveraging our experience in insurance and reinsurance markets, including distribution channels,” Haveron concluded.
