Oxbridge Re Holdings, a provider of reinsurance solutions primarily to property & casualty insurers, has reported a net loss of $85,000 in the second-quarter of 2023, compared to net income of $77,000 in the second quarter of 2022.
The company stated that the loss in the quarter is primarily due to higher general and administrative expenses as a result of the recognition of all costs associated with the SurancePlus token offering completed during the quarter.
The combined ratio increased to 601.6% for the six months ended June 30, 2023 from 191.1% in the prior year due to the higher general and administrative expenses incurred in 2023.
Net premiums earned in the second quarter were $183,000 compared to $194,000 in the same prior year period.
Total expenses were $697,000 for Q2’23 compared to $410,000 for Q2’22. The increase was due to higher general and administrative expenses resulting from inflationary expense fluctuations compared to the prior year.
For the first half of 2023, the Company generated a net profit of $57,000, compared to a net loss of $310,000 for the six months ended June 30, 2022. The improved results were primarily due to higher revenues driven by the increase in unrealised gains on other investment and equity securities.
For the first half of 2023, net premiums earned were $183,000 compared to $404,000 in the prior year. The decrease was due to reinsurance contracts in force during the period ended June 30, 2023 compared to the prior year.
There were no losses incurred for the three and six months ended June 30, 2023 or 2022, the company noted.
At June 30, 2023, cash and cash equivalents, and restricted cash and cash equivalents were $3.5 million compared to $3.9 million at December 31, 2022.
The loss ratio was 0% for the period ended June 30, 2023 and 2022 due to no loss or loss adjustment expenses in either period.
The expense ratio, which measures operating performance, compares policy acquisition costs and general and administrative expenses with net premiums earned, increased to 601.6% for the six months ended June 30, 2023 from 191.1% in the prior year. This increase was due to the higher general and administrative expenses incurred in 2023.
“During the second quarter we were pleased to complete the private placement of approximately $2.4 million in securitized tokens by our new Web3-focused subsidiary SurancePlus Inc., an alternative investment opportunity leveraging key qualities of blockchain technology to create a well-designed digital security,” said Oxbridge Re Holdings Chief Executive Officer Jay Madhu.
“Assuming there are no losses underwritten by our reinsurance contracts, investors in the securitized tokens are expected to generate a potential annual return of an estimated 42%,” Madhu added.
“Looking ahead, with a strong balance sheet, no debt, and with our recent transactions a well-diversified business, we remain highly confident in our future ability to deliver shareholder value,” Madhu concluded.
