Reinsurance News

MS Amlin Underwriting returns to profit after “careful restructuring”

24th March 2022 - Author: Jack Willard

MS Amlin Underwriting (MS AUL) has reported its full year results for 2021 which saw the global re/insurer deliver a strong performance, as well as a return to profitability after years of careful restructuring and remediation.

ms-amlin-logoThe return to profitability for the company is set against the backdrop of a year which saw a large number of natural catastrophe events that were estimated to be within the top five most costly ever for insured losses.

The Lloyds specialty re/insurer had exposure to Hurricane Ida, US tornadoes, European floods and the Uri Texas freeze, but despite these financial headwinds the company saw a positive swing of £186 million to deliver a profit of £7.9 million, compared against a loss of £178.1 million in 2020.

In addition, the company saw improvements in claims ratio during 2021, delivering 59%, compared with 76% in 2020.

The company’s focus on the underlying underwriting discipline is also strongly evidenced in the improved capital ratios of the two core divisions of insurance and reinsurance, which delivered 91% (FY20 101%) and 92% (FY20 135%) respectively.

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Overall, MS AUL has reported a combined ratio of 102% for 2021, compared with 119% in 2020.

CEO of MS Amlin Underwriting, Johan Slabbert commented: “These results are tangible evidence that the recent years of careful restructuring and remediation are starting to bear fruit. Whilst we have reached our journey to profitability thanks to the renewed strength of our foundation, the simplification of our model and underwriting discipline, it is the potential of this business that is most exciting. We are only at the beginning of what we can achieve, and today we step closer to being able to deliver consistently again for our clients, people, broker partners and our shareholder.”

The momentum behind the financial, operational and strategic performance of the re/insurer during 2021 was also driven by the restructuring actions completed during the period which enabled the syndicate to simplify its operating model, enhance strategic and operational oversight, and allow for a focus on its core markets of reinsurance and insurance.

In addition, as the syndicate looks to grow its profitability over the coming years, it will continue to explore a variety of initiatives to manage costs and its capital base, while focusing on improving the quality of the existing portfolio of risks.

Slabbert said: “I’m proud of our people for their hard work and commitment, and we will continue to build on our progress over the coming years as we look to improve the profitability of our existing portfolio and grow into a sustainable, future-proof and client-first business.”

Part of their ongoing improvement on profitability, post period end, MS AUL entered into a split reinsurance to close (RITC) contract of the UK property and casualty portfolio of the 2019 and prior years of account with RiverStone International. The RITC became effective on 1 January 2022. which will also improve operational simplification.

The Syndicate has also taken advantage of profitable business produced by ITMA, a specialist US based MGA, acquired in 2021.

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