Insurer Markel Group has 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 has reported comprehensive income of more than $1.1 billion for the nine month period compared with a loss a year earlier.
In Q3 2023, the combined ratio weakened to 99% from 93% in Q3 2022 and rose from 91% in 9M 2022 to 95% in 9M 2023. A higher attritional loss ratio and less favourable reserve development was partially offset by lower losses from catastrophes.
The underwriting result for the quarter and nine month 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.
Earned premiums rose 8% in Q3 2023 to $2.1 billion, and by 9% in 9M 2023 to $6.1 billion, driven by growth in gross premium volume.
At Markel Ventures, operating revenues increased slightly in Q3 2023 to $1.25 billion, and rose to $3.7 billion in 9M 2023. Operating income in this part of the business grew 77% for the quarter and 52% for the first nine months, reflecting higher operating margins at Markel’s products businesses.
On the asset side of the balance sheet, Markel has reported Q3 2023 net investment income of $192 million compared with $113 million a year earlier, and a rise to $521 million for 9M 2023 against $302 million in 9M 2022. However, for the quarter, Markel also recorded net investment losses of more than $265 million.
All in all, Markel has reported a comprehensive loss of $107.5 million for Q3 2023 compared with loss of $348 million a year earlier. For 9M 2023, the firm has reported comprehensive income of $1.1 billion compared with a loss of more than $2 billion in 9M 2022.
Tom Gayner, Chief Executive Officer, commented: “Markel Ventures delivered exceptional margins and cash flows this quarter and our net investment income was up significantly. Additionally, our insurance engine generated strong cash flows for our investments engine while remaining intensely focused on navigating current insurance market dynamics and shaping our portfolio for long-term value creation. This quarter stands as yet another example that we can go a lot further and faster on our road to build one of the world’s great companies with three engines instead of just one.”
