Tokio Martine Kiln (TMK) has said that rate rises are positively impacting the 2019 year of account and are continuing into 2020, while the 2017 and 2018 year of accounts remain pressured on the back of heavy catastrophe losses.
TMK, which is part of large Japanese insurer, Tokio Marine, has released the final results for its non-aligned syndicates for the 2017 year of account, and also provided some updates and details for the 2018 & 2019 year of account.
Regarding the 2019 year of account, the firm states that rate rises, most notably in property, aviation and liability accounts are having a positive impact, and this trend is continuing into 2020.
According to TMK, the 2017 year of account remains in a loss position, albeit improving in Lloyd’s Syndicates 510 and 557, driven by the impacts of the heavy catastrophe load in the year.
Starting with Syndicate 510, TMK notes capacity of more than $1.1 billion and a result of -2.3% as a percentage of capacity. This is towards the lower end of the previous forecast range as at November 2019, of -6.8% to -1.8%. Syndicate 557, with capacity of $32 million produced a result of -14.7% as a percentage of capacity, against a previous forecast range as at November 2019 of -25.6% to -20.6%.
TMK states that while the losses are a result of the catastrophe experience, the improvements are driven by prior year reserve releases.
Brad Irick, Chief Executive Officer (CEO) of TMK, commented: “2017 was a challenging year for the insurance industry, which is reflected in these results. Our market-leading Claims teams continues to work hard to handle remaining losses and support our customers quickly and compassionately, ensuring that we deliver on the commitments we have made to them.
“We have seen some encouraging rate improvements in selected areas of the market and our underwriters are capitalising on those opportunities. Our specialist underwriting expertise positions us well in this changing market and where we see the opportunity to grow profitably we will do so, while maintaining a laser-focus on bottom-line results.”
Turning to the 2018 year of account forecasts, Syndicate 510 had capacity of more than $1.1 billion, with a forecast range as at February 2020 of -5.6% to -0.6%, which is unchanged from the previous forecast range as at November 2019.
Syndicate 557 had capacity of $31 million and TMK reveals a forecast range as at February 2020 of -3.9% to 1.1%, which is an improvement on the previous forecast range as at November 2019 of -4.6% to 0.4%.
According to TMK, the forecast ranges for both Syndicates reflect early cat losses on the California wildfires, as well as Hurricane Michael and Florence. Improvements witnessed in Syndicate 557 are driven by improvements on Camp wildfire, states TMK.
Looking at Syndicate 308, which is in run-off, TMK notes that the 2017 year is not being closed on 31st December 2019. TMK is servicing the existing business professionally and will ensure that there is no detriment to policyholders.
