Trisura Group, an international specialty provider of surety, risk solutions, corporate insurance and reinsurance products, has grown its net income to $8.4 million for the first quarter of 2020.
The result was an improvement on the $2.5 million posted in Q1 2019, driven by strong underwriting performance and investment income in Canada, and growing profitability in the US.
However, while preliminary results for April have shown resilience, Trisura expects Q2 premium generation and claims activity to be impacted by the length and depth of the pandemic-related economic slowdown, as well as the effectiveness of government support programs
That said, Trisura did not observe a significant impact on underwriting results in April, and its policies generally do not provide pandemic coverage, while many surety bonds are focused on infrastructure projects deemed essential.
The most direct financial impact related to COVID-19 in Q1 was the mark-to-market volatility in the investment portfolio.
“We are pleased with Trisura’s first quarter results, generating net income of $8.4 million, vs. $2.5 million in Q1 2019 driven by increasing profitability from our US platform and continued strength in Canada,” said David Clare, President and CEO of Trisura.
“Importantly, improved asset-liability matching in our international reinsurance operations limited volatility in a challenging environment,” Clare continued.
“Notwithstanding our improved net income, book value per share decreased as a result of mark-to-market losses in the investment portfolio. However, our balance sheet remains healthy. Regulatory capital levels are strong despite market volatility while liquidity has been enhanced through an increase in available capacity from our revolving credit facility.”
In its US operations, Trisura bound $120.7 million of gross premiums written and generated $2.6 million in net income.
Meanwhile, in Canada, disciplined underwriting and enhanced investment returns sustained a 19.3% return on equity.
