Tokio Marine Kiln has now announced the final results for its three non-aligned Lloyd’s of London Syndicates for the 2015 year of account, as well as updated forecasts for 2016 and initial forecasts for 2017, in light of high catastrophe losses in the second-half of last year.
Tokio Marine Kiln Syndicates Limited operates Syndicates 510, 557, and Life Syndicate 308 at the Lloyd’s of London specialist insurance and reinsurance marketplace, although the latter has been placed into run-off in response to challenging market competition.
The firm announced last year that the 2015 year of account had shown some improvements, and benefitting from a fairly benign catastrophe experience, Syndicates 510 and 557 delivered profits for the 2015 year of account, with the latter recording its highest return on capacity in recent years.
Syndicate 510 capacity reached £1.063 billion with a result of 11.1% for the 2015 year of account, while Syndicate 517 capacity reached £35 million, with a result of 29.9%. Unfortunately, and due to the challenging and competitive market landscape, Life Syndicate 308’s capacity reached £32 million and its result was -6.3% for the 2015 year of account.
“I am pleased to report that we have delivered a very good set of results from our non-life syndicates 510 and 557 for the closing 2015 year of account,” said Charles Franks, Chief Executive Officer (CEO) of Tokio Marine Kiln.
For the 2016 year of account, the firm has provided updated forecasts, including Syndicate 510 capacity of £1.062 billion, and a result range of -3.7% – 1.3%, compared with a previous range of -3.4% – 1.6%. For Syndicate 557 capacity is £35 million with a result range of 11.2% – 16.2%, compared with a previous range of 9.9% – 14.9%. Syndicate 308 capacity is forecast at £32 million, with a range of -14.6% – -9.6%, compared with a previous range of -14.5% – -9.5%.
“The succession of severe catastrophic events in the second half of 2017 have resulted in significant forecast losses for Syndicates 510 and 557 in the 2017 year of account. While it is disappointing to report a loss, our performance is in line with modelled expectations for these types of event, and such losses serve as a reminder of the critical role insurers play in supporting our customers in times of need.
“We have seen some improvements in the rating environment following Hurricanes Harvey, Irma and Maria (HIM), particularly in loss-affected areas, after several years of rate reductions. While competitive challenges remain, we are creating our own opportunities rather than waiting for the market to do that for us, and we are seeing encouraging signs for what lies ahead. Our focus on enabling our customers to thrive through service, collaboration and innovation, including embracing digital distribution through our online platform and supporting market modernisation initiatives, is complemented by strict underwriting discipline,” said Franks.
For the 2017 year of account, the firm has provided initial forecasts for Syndicate 510 capacity of £1.131 billion and a result range of -14.9% – -4.9%, and for Syndicate 557 capacity of £34 million and a forecast result range of -45% – -35%.
