Reinsurance News

White Mountains falls to full-year loss despite “light” Q4 cats

9th February 2022 - Author: Matt Sheehan

Bermuda-domiciled financial services holding company White Mountains has posted comprehensive income of $34 million for the fourth quarter of 2021, and a loss of $273 million for the full-year.

white-mountains-insurance-logoBoth figures were well below the $495 million and $716 million of comprehensive income that the company reported in the same respective periods last year.

They follow a loss of $373 million in Q3, when Ark, which is White Mountains’ P&C re/insurance focused business, was heavily impacted by natural catastrophe losses.

In Q4, the company assured that Ark had reported a favourable combined ratio after being impacted by only “light catastrophes,” which helped White Mountains’ overall results to remain outside of negative territory.

Ark’s adjusted combined ratio, which adds back amounts ceded to third-party capital providers, was 67% and 85% in the fourth quarter and year ended December 31, 2021, with the full-year figure including 10 points of catastrophe losses.

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The Q4 combined ratio also included five points of net favorable development on catastrophe losses incurred in 2021, principally from Hurricane Ida.

Ark reported net written premiums of $134 million in Q4 and $859 million for the full-year period.

“Ark had a good finish to the year with an adjusted combined ratio of 67% in the fourth quarter, benefiting from both light catastrophes and favorable reserve development,” said Ian Beaton, CEO of Ark.

“For the full year, Ark produced an adjusted combined ratio of 85%, an encouraging result in a year with heavy global catastrophe activity.”

Returning to White Mountains’ overall results, the company reported $55 million and $380 million of net realized and unrealized investment losses from its investment in MediaAlpha for the Q4 and full-year periods.

Results in the fourth quarter and full year also included $391 million and $746 million of net investment income and realized and unrealized investment gains from White Mountains’ investment in MediaAlpha, as well as $131 million from the release of a deferred tax liability as a result of an internal reorganization in connection with the MediaAlpha IPO.

“Strong results from our operating companies were partially offset by a mark-to-market decline in the value of our investment in MediaAlpha,” acknowledged White Mountains CEO Manning Rountree.

“Ark produced good underwriting results for the quarter and the year, while growing full year premiums 78%,” he added.

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