Bermudian reinsurer PartnerRe has posted net income of $497 million for the first quarter of 2019, boosted by the strong performance of its property and casualty (P&C) segment, which had a combined ratio of 87.7%.
The results represent an improvement on Q1 2018, when PartnerRe posted a net loss of $210 million, which contributed to an overall loss of $132 million for the full-year.
The reinsurer grew its non-life net premiums written by 24% compared to the first quarter of 2018, driven by a 30% increase in the P&C segment and a 13% increase in the specialty segment.
Non-life underwriting profit, however, was $24 million for the quarter with a combined ratio of 97.7%, compared to $44 million with a combined ratio of 95.2% for the same period last year.
The combined ratio continued to benefit from net favourable prior years’ reserve development of $11 million (1.1 points) for the quarter, compared to $34 million (3.7 points) in Q1 2018, with favourable development in the P&C segment in the quarter offset by negative development in the specialty segment.
For the P&C segment, the combined ratio was 87.7% for the quarter, compared to 100.2% last year, driven by an improvement in the current accident year technical ratio and higher prior year favourable reserve development.
The ratio included $49 million (7.3 points) of favourable prior year reserve development, including the 2018 catastrophic events where an increase in Jebi losses was offset by retro recoveries.
This compares with $11 million (1.9 points) favourable prior year reserve development in the first quarter of 2018.
In terms of life and health, PartnerRe’s net premiums written were up 18% in Q1, primarily driven by growth in life business.
The allocated underwriting was a gain of $30 million, supported by 17% growth in net premium earned and 30% growth in technical result, but partially offset by a $4 million other expense increase.
PartnerRe’s net investment return for the quarter was $600 million, or 3.6%, and included net investment income of $110 million, net realized and unrealized investment gains of $469 million and interest in earnings of equity method investments of $21 million.
This compares with a net investment loss of $102 million in the first quarter of 2018.
Emmanuel Clarke, President and CEO of PartnerRe, commented on the company’s results: “In the first quarter of 2019, we delivered strong results in our P&C and Life and Health segments, and in our Investments portfolio, while reporting an underwriting loss in our Specialty segment, driven by a combination of mid-sized losses and negative reserve development, and where we are undertaking portfolio actions to improve future underwriting performance.”
He continued: “Positive momentum continued in our April 1 Non-life renewals with business production up double-digits on the back of continued improvements in the overall pricing environment, further solidifying the Company’s improved underwriting performance outlook for the remainder of the year.”