Markel has suggested that the property market pricing environment should be “firm and constructive” going into 2024, with the company noting it has the ability to deploy more capital there should it choose to do so.
These comments stem from Markel’s Q3 earnings call, in which Jeremy Noble, President of Insurance, discussed the potential opportunities within the property space.
“We have access and can take advantage of the property market environment and the risk-adjusted return propositions in a couple of different ways,” Noble explained.
He continued, “We can write that through conventional traditional insurance, and we are also taking advantage of that through insurance-linked securities operations, which is more where the reinsurance would come into play.
“This year has been interesting. Fortunately, we’re 10 months into the year and we’re largely through the wind season and the books have performed across the industry quite well. It’s been a challenging last six years. Five of the last six years have seen aggregate insurance losses in excess of $100 billion.”
Noble went on, “So, while the risk-adjusted return proposition from a model situation looked very compelling this year, there were questions in our mind as to how the year was going to play out.
“We did grow and take advantage of the rate and pricing environment, but then it was a question of what will it look like going into 2024. Will the pricing environment be sustainable? Or would it change after one year?
“It does look like we should have a stable but firm and constructive market pricing environment, so we have the ability to deploy more capital there should we choose to do so.”
In its Q3 results, Markel reported a higher combined ratio for both Q3 and 9m 2023 on the back of a higher attritional loss ratio and less favourable prior year reserve development, but saw comprehensive income of more than $1.1 billion for the nine-month period compared with a loss a year earlier.
The underwriting result for the quarter and 9m period included $46.2 million of net losses and loss adjustment expenses attributed to the Hawaii wildfires and Hurricane Idalia. In 2022, the Q3 and 9M underwriting result included net losses of $70 million related to Hurricane Ian.
