In its Q1 2023 results, re/insurance holding company W.R. Berkley Corporation reported that net investment income grew almost 29% as an increasingly greater portion of its fixed-maturity portfolio was (re)invested at higher interest rates.
“We maintained the short duration and high quality of our fixed-maturity portfolio, given the inverted yield curve and market volatility,” the firm writes.
W.R. Berkley’s annualized return on equity in Q1 was 17.4% and growth in book value per share, prior to dividends and share repurchases, was 7.2%.
Gross premiums written in Q1 of 2023 stood at $3.05 billion, an increase compared to 2022’s Q1 of $2.86 billion. Net premiums written also increased to $2.57 billion, up from $2.41 billion in the same quarter last year.
Net income available to common stockholders was $294.1 million, down from $590.6 million in Q1 of 2022. Operating income was also down slightly from 2022’s $306.9 million to $276 million. Pre-tax underwriting income in Q1 2023 was $234.4 million.
W.R. Berkley’s current accident year combined ratio before catastrophe losses of 1.9 loss ratio points was 87.7%.
The firm’s reported combined ratio was 90.6%, including current accident year catastrophe losses of $47.9 million and prior year development principally from property catastrophe losses of approximately $24 million.
Total capital returned to shareholders in Q1 was $293.8 million, consisting of $132.3 million of special dividends, $26.3 million of regular dividends and $135.2 million of share repurchases.
In a written statement, W.R. Berkley said, “The business continued to grow in areas that we anticipate will meet or exceed our targeted risk-adjusted return.
“While there is greater evidence that market segments and lines of business are not all moving in lock-step, our structure and discipline enable us to execute on and manage each of these cycles to optimize profitability, even as we maintain a prudent view of loss trends.
“We continue to carefully evaluate the available opportunities to deploy capital as we selectively expand our business.”
The firm continued, “The Company continues to focus on risk-adjusted return in all aspects of its business.
“Over time, this discipline has allowed us to navigate risks and embrace opportunities to deliver superior results for our shareholders. We remain encouraged about the opportunities that we see in 2023 and beyond.”
