P&C re/insurer Sompo International has reported a 2022 underwriting income of $532 million, up 25% YoY due to margin improvement and top-line growth.
For the fiscal year 2023, Sompo anticipates underwriting profit to increase to $789 million, led by loss ratio improvement in Agriculture and other insurance businesses.
Meanwhile, gross premiums written in 2022 stood at $13.48 billion, up 9.9% from the previous year. Net premiums written expanded by 18% to $8.9 billion, which Sompo attributes to higher crop prices and increased retention.
The firm’s forecast for 2023 net written premiums is $9.895 billion, which it expects will be driven by rate increases and new initiatives.
Sompo International’s combined ratio for 2022 improved by 0.4pt YoY to 93.5%, due to expense ratio improvement driven by lower acquisition costs.
In 2023, the firm anticipates the combined ratio to drop to 91.6% due to improvement in crop insurance loss ratio and “controlled catastrophe risk-taking.”
Elsewhere, investment income increased 17% YoY to $542 million, due to increased net interest and dividend income on a larger investment base and higher reinvestment yields. Sompo’s forecast investment income for 2023 is $797 million.
Looking at net incurred losses related to overseas natural disasters, Sompo’s total was $553m, of which Hurricane Ian accounted for $362m, the Australian Floods $54m, French hailstorm $44m, Winter storm Elliott $21m, and an additional $71m incurred from non named events.
The firm notes that though the size of the overall loss by natural disasters in 2022 is roughly equivalent to 2017, the loss ratio impact is less than one-third, due to managing catastrophe exposures.
Total overseas adjusted profit for the fiscal year 2022 was $703m, which marked an increase of 30.8%. Sompo expects this to increase by a further 57.3% in 2023 to $1.07 billion
