California-based specialty insurer Palomar has reported a net loss of $1.8 million for Q4 2020 compared to net income of $10.9 million per diluted share for the prior year period.
Palomar’s gross written premiums (GWP) witnessed a year-on-year increase in Q4 2020 by 31.0% to $96.1 million compared to $73.3 million in the Q4 2019.
With an underwriting loss of $5.0 million, Palomar’s income decreased year-on-year and resulted in a combined ratio of 112.8% compared to underwriting income of $11.4 million and a combined ratio of 63.1% during the same period last year.
Net investment income had a greater contribution for the firm in the fourth-quarter, increasing by 29.0% to $2.3 million compared to $1.8 million in the prior year’s fourth quarter.
Mac Armstrong, Chairman and Chief Executive Officer said: “I am inspired by the efforts of our team to grow and evolve our business during the past year. We launched new products and a new insurance carrier, entered into new geographies, made key additions to our team, and continued our pursuit of the Company’s strategic vision all while navigating circumstances that few of us could have anticipated.
“Our newly launched E&S carrier, Palomar Excess and Surplus Insurance Company, or PESIC, represents an exciting progression in our evolution. PESIC enables us to extend the breadth and reach of our product suite and was a key contributor to the 95% year on year growth in our commercial lines gross written premiums for the full year.
“Overall, we grew gross written premiums by 31.0% in the fourth quarter and 40.6% for the full year while maintaining profitability in the face of an historic wind season.
“We are committed to applying data and lessons learned to the continuous improvement of our business. During this past year we modified our approach to and participation in specific wind-exposed markets upon review of potential risk-adjusted returns, catastrophe payback and prevailing market conditions.
“We also made additional refinements to our risk transfer strategy. The combination of these efforts will not only reduce volatility but also further enhance visibility into our financial results. Finally, we continued investing in our technology and our team as we position Palomar for near and long-term success.”