White Mountains has released its fourth-quarter results for 2022, reporting that its Ark partner firm produced strong underwriting results in both the quarter and the full year, while growing full-year gross written premiums 37%, according to CEO Manning Rountree.
Ark saw gross written premiums (GWP) rise to $200m in Q4 2022 compared to the $164m in Q4 2021. Its GWP year ended December 31, 2022, saw an increase as well, to $1,452m from $1,059m in the year ended December 31, 2021.
It reported net written premiums of $189m and $1,195m, and net earned premiums of $286m and $1,043m in the fourth quarter and 2022. Which compare to net written premiums of $134m and $859m, and net earned premiums of $202 million and $637m in the fourth quarter and 2021.
The reinsurer also reported pre-tax income of $116m in Q4 and $95m last year, compared to $57m and $53m in Q4 2021 and year ended December 31, 2021.
According to the firm, Ark’s results included net realised and unrealized investment gains of $21m and $55m of loss in the fourth quarter and 2022 compared to $6m and $17m gained in the fourth quarter and 2021.
Ark’s pre-tax income for the year ended December 31, 2021 also included $25m of transaction expenses related to White Mountains’s transaction with Ark.
Ian Beaton, CEO of Ark, said, “Ark had a strong finish to the year with a GAAP combined ratio of 59% in the fourth quarter, benefiting from light catastrophes and favourable reserve development. For the full year, Ark produced a GAAP combined ratio of 82%.
“Gross written premiums were $1.5bn for the year, up 37% from 2021 with risk adjusted rate change of 9%. In December, AM Best completed its annual review and affirmed Ark’s ‘A/stable’ rating. Ark had a solid start to 2023, exceeding $575m of gross written premiums in January, with risk adjusted rate change of 15%.”
White Mountains, meanwhile, said that its comprehensive income attributable to common shareholders was $40m and $788m in the fourth quarter and 2022 compared to $34m and the loss of $273m in the fourth quarter and 2021.
According to White Mountain, its 2022 results were driven primarily by the net gain from the sale of NSM of $876m recorded in the Q3, which included the impact of compensation and other costs recorded in other operations.
The firm noted that its 2021 results were driven primarily by $380m of net realised and unrealized investment losses from White Mountains’s investment in MediaAlpha.
Additionally, during the fourth quarter of 2022, White Mountains invested $205m into Outrigger Re Ltd., a newly-formed Bermuda special purpose insurer that will provide reinsurance protection on a portion of Ark’s Bermuda global property catastrophe portfolio written in calendar year 2023.
Manning Rountree, CEO, commented: “We had a solid fourth quarter capping an excellent year. ABVPS was up 2% in the quarter and 26% for the full year. In the quarter, we had good results from our operating companies and positive returns in our investment portfolio.
“BAM produced $38m of gross written premiums and member surplus contributions in the quarter, capping a record year. Ark produced strong underwriting results in both the quarter and the full year, while growing full-year gross written premiums 37%.
“Kudu grew the fair value of its continuing portfolio and closed two value-adding exit transactions in the quarter, capping a good all-around year. Our investment portfolio was up 2.1% in the quarter and down 1.6% for the full year, an excellent relative result.
“At year end, we successfully launched Outrigger Re, deploying $205m of capital. We finished the year with roughly $900m of undeployed capital.”
