Parametric flood insurance has ‘compelling’ proposition amid troubled markets

by | Mar 22, 2023 | Insurance


FloodFlash opened its US division at the start of this year, initially launching for commercial property in Florida, Virginia, Texas, Louisiana, and California. It aims to expand to 48 continental states, excluding Alaska and Hawaii.

“The things that led to the Florida insurance market’s collapse make parametric insurance an even more powerful value proposition because there isn’t a protracted claims process [with parametric],” Hara said. “The timing couldn’t have been better to bring a new product.”

FloodFlash, which has claimed to be the first insurance provider to pay catastrophic flood claims as quickly as four hours, uses computer models, cloud software, and connected technology to power its parametric products.

Crossing the pond

Despite the prevalence of flood risk, fewer than five percent of small to mid-size businesses in the US carry flood insurance.

“Most flooding occurs in what’s considered a non-flood zone every day in the United States, and so the risk is pervasive. It is such a large opportunity,” said Hara.

As CEO of North America, Hara is charged with developing and executing FloodFlash’s go-to-market strategy.

Prior to leading the ambitious expansion, Hara led two insurtech startups, Mylo and BoldPenguin. He also had insurance experience while working at Nationwide as vice president of digital marketing and chief innovation officer.

Setting up in the US, the largest insurance market in the world, was always in the cards for FloodFlash.

“After FloodFlash had proven its parametric flood insurance business model and scaled rapidly in the UK, it made sense to launch in the US,” Hara said.

“We chose the five states because we wanted to have focus and address [the flood protection gap] through steps versus all at once.”

The company, established five years ago, has raised $15 million in Series A funding to fuel its expansion plans. It is also eyeing entry into Germany, Australia, and Japan.

‘Consultative’ approach

Hara noted key differences between the flood insurance markets in the UK and US.

Navigating a new market meant implementing lessons learned from FloodFlash’s initial journey and establishing strong relationships with the distribution channel.

“We’ve tried to retain the lessons learned from the UK and apply them to the US. The market is a little bit different in the UK, which doesn’t have hurricane risk, for example,” he said.

“We’re working with brokers and agents to educate them on the parametric flood product and to help clients understand and feel comfortable with what they’re being recommended.

“The biggest thing is having a consultative approach, which is similar to how we’ve operated in the UK. It’s very complementary to how the market already works here.”

Plunging into Florida’s property market

Weeks before FloodFlash announced its entry into Florida, the state unveiled a suite of insurance reforms to prop up its ailing property insurance market.

Though a particularly complex time for insurers in the state, Hara said that FloodFlash has received a tremendous reception from brokers and agents.

“Florida’s been great. The receptivity from the insurance brokers, agencies and even wholesalers has been extremely good because they’re always interested in a product that helps serve a need of their clients,” said Hara.

“The clients themselves have also been very receptive to learning about this product and how it fits in their overall coverage needs.”

Parametric flood insurance’s winning formula is the combination of flexibility in its coverage structure and speed of payout, according to the executive.

“If flooding occurs and it reaches the depth that [the insured purchased, then that initiates the claims process,” Hara said. “That’s what’s unique about parametric, you don’t have the loss adjustment, no lag time, no expense and time spent figuring out whether the actual event occurred.”

FloodFlash wants to focus on working with distribution partners while bringing new coverage to other states.

“We’re planning to add additional states over time, and our plans are calling for probably two to three [new states] every six months,” said Hara.

What do you make of FloodFlash’s entry into the US market? Share your thoughts below.



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DE&I talks significantly increased after George Floyd’s murder

DE&I talks significantly increased after George Floyd’s murder

by | Mar 22, 2023 | Insurance


Some encouraging progress

“There are these moments that are tipping points and they push us from creeping along slowly in our culture change efforts to making a leap during a particular moment” said Omari Jahi Aarons (pictured below), executive director and chief operating officer of NAAIA.

Using the Black Lives Matter protests in the wake of Floyd’s death as a catalyst to examine any structural change within the insurance industry, the results presented in The Next Steps on the Journey: Has Anything Changed? showcased the following observations from participants:

  • 57% increase in DE&I-related training

  • 35% in ERG support

  • Leadership accountability rose 29%

  • Black entry level hires increased 26%

While these numbers did show signs of progress in recognizing and mending diversity issues, participants were keen to note how more needs to be done to bring in talent and promote upward mobility into senior and executive positions.  

Attracting and leveraging individuals

A significant barrier to raising interest for a career in the insurance industry comes African Americans potentially being culturally attuned to distrust financial institutions.

“When we look at insurance and financial services, as well as predatory lending practices and redlining, the notion of people storing money under their mattress and thinking that is safer than in a bank is a very real thing,” Aarons said.

“Those lessons and stories have been passed along generation after generation”

NAAIA is working hard to dismantle these deeply engrained attitudes towards institutional money handling practices. Aarons and his team have been visiting traditionally Black communities to offer insight into acquiring helpful insurance policies.

“We have to go back to the beginning and educate the community at large, allowing insurance talk to infiltrate dinner table conversations, helping close the racial wealth gap in the US while also baiting interest in entering the field professionally” Aarons said.

This hesitancy also effects the number of African Americans in executive roles within the industry where Aarons noted “we also know the way that people climb is through relationships. If I get a job, then you get a job. If I get promoted, you get promoted.”

“Professionals mostly bring along their crew as they ascend in a company or organization. We must now do the work early on through development and cohort programs to ensure that this crew is racially diverse while also including individuals across the gender spectrum.”

Analyzing the participants

A follow up to a similarly themed 2018 report, Aarons and his team witnessed a positive increase in the diversity of individuals who agreed to take part in the study.

Over 650 professionals agreed to participate — through both interviews and focus groups — a number that more than doubled the respondents in 2018.

  • Women made up 68% of participants

  • 26% of these women earn between $100,000-150,000

  • While 17% earn over $200,000

While an increased turn out of female participants was a welcome change, Aarons pointed out glaring omissions from the study. “We saw that Black men, LGBTQIA+ individuals, millennials and gen z, as well as executive and c-suite level professionals were not as present in the interviewing and research phase,” he said.

“To continue to make strident efforts in diversity, equity and inclusion and collate data that is useful as a whole, we need to find ways to recruit these groups in our research to paint a more thorough picture of the industry.”

Creating a dialogue

Aarons and his team at NAAIA understand that systemic roadblocks cannot be resolved in a short timeframe, but require years of analysis, reflection and action planning.

“The message that we want people to glean from The Next Steps on the Journey study is that the research presented is designed to spark conversation” Aarons said. “Don’t just read the report and put it on the shelf. Have that talk, take it into other rooms, discuss it with the leadership at your company.”

While the organization does offer its partners and the general the opportunities to attend DEI-focused events, it is ultimately pushing for a level of introspection. 

“We would love to see businesses and professionals inquire about how they can help from where they are right now. What are the actions they can take to make the industry more inclusive and equitable?”

With the information and recommendations provided, NAAIA is confident that when it has completed the third instalment of the study, the numbers within it are going to be different.

“We’re going to see the compensation band higher,” Aarons said. “We’re going to see barriers to retention and entry in the insurance industry reduced.

“Furthermore, we’re going to see millennials, gen z, Black men and LGBTQIA+ individuals take part as well..

What did you think about this report’s findings? Let us know in the comments section below.





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Chubb distances itself from oil and gas projects

by | Mar 22, 2023 | Insurance


The insurer also released new underwriting criteria for oil and gas extraction projects that will require clients to reduce methane emissions, a by-product of oil and gas production that are among the most severe greenhouse gases (GHG). The criteria are part of an ongoing partnership and consultation with environmental stakeholders and experts.

Evan G. Greenberg, chairman and CEO of Chubb, said the methane-related underwriting criteria are the first of their kind in the industry.

“[They] are focused on the balance between the need to transition to a low-carbon economy and society’s need for energy security,” Greenberg said.

“As a company, we are accelerating and expanding our climate-related initiatives without committing to sweeping net-zero pledges for which, in our judgment, there is not a viable path to achieve. We will continue to pursue in earnest a responsible, realistic, and science-based approach. Implementing these underwriting criteria encourages oil and gas producers to adopt technologies to reduce GHG emissions in extraction. We know that many of our clients in the industry are already committed to limiting methane emissions, and we will work to expand those commitments.”

Chubb’s standards for methane emissions

Chubb will provide insurance coverage for clients implementing evidence-based plans to manage methane emissions, including, at a minimum, having programs for leak detection and repairing and eliminating non-emergency venting.

“Clients must adopt one or more measures that have been demonstrated to reduce emissions from flaring. These criteria will commence immediately, and customers will have a set period to develop an action plan based on their individual risk characteristics,” Chubb said in a statement.

Chubb will also create a customer resource center to support oil and gas insureds in identifying and adopting methane emissions reduction technologies.

Chubb’s standards for protected conservation areas

Chubb will not underwrite oil and gas extraction projects in protected areas designated by state, provincial, or national governments, effective immediately.

The insurer’s policy applies to conservation areas covered by International Union for the Conservation of Nature (IUCN) management categories I-V in the World Database on Protected Areas, which includes nature reserves, wilderness areas, national parks and monuments, habitat or species management areas, and protected landscapes and seascapes. The sixth IUCN category applies to protected areas that allow sustainable use.

By the end of 2023, Chubb aims to develop and adopt standards for projects in category VI areas in the World Database of Protected Areas and for oil and gas extraction projects in the Arctic, Key Biodiversity Areas, mangrove forests, and global peatlands that are not currently listed in the World Database on Protected Areas.

“Our policy on not insuring energy projects in protected areas also reflects our approach to setting clear guidelines to sustain biodiversity and protect nature,” Greenberg said. “Taken together, our new underwriting criteria, along with our other substantive actions, are grounded in our commitment to lead the industry in the transition while balancing the need for energy security.”

Last year, around 50 climate activists protested Chubb’s policies on fossil fuel insurance and deliver a petition that the group said had over 50,000 signatories.





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Best Wholesale Brokers USA | 5-Star Wholesale Brokers and MGAs

Best Wholesale Brokers USA | 5-Star Wholesale Brokers and MGAs

by | Mar 22, 2023 | Insurance


Jump to winners | Jump to methodology

Thriving in a hard market

Wholesale brokers and MGAs are thriving by being quick and nimble in meeting clients’ needs. IBA’s 5-Star winners are at the cutting edge of that, leading the way with their impeccable performance levels.

“In general, the segment is experiencing rapid growth in premium written right now, which indicates that they’re important to the industry,” says Brady Kelley, the executive director of the Wholesale & Specialty Insurance Association. He also explains how AM Best’s 2022 market segment was reported:

• 25% growth in surplus lines direct premiums written in 2021

• new annual record of $82.7 billion in 2021

• 4.1% increase in the surplus lines premium for the 15 states with surplus lines stamping offices

• 6.9% increase in overall transactions

 

“The segment is experiencing rapid growth in premium written right now, which indicates that they’re important to the industry”



Brady Kelley, Wholesale & Specialty Insurance Association

 

What makes a top wholesale broker and MGA in 2023?

In the survey, respondents ranked the importance of certain factors when choosing a wholesale broker and MGA.

“We all know we have to have service, pricing and product,” explains Peter Burrous, chief marketing officer of winner Johnson & Johnson (J&J).

“And then you’ve got to have value-added offerings. And to us, that is technology. We don’t go outside; we write everything in house. We can zig and zag quickly; that way we’re nimble. So, technology is a huge driving force at J&J. And then our second area would be sales and marketing,” he adds.

According to Bruce Peddle, divisional president of winner Jencap, the survey data hierarchy is a “laundry list of usual suspects”, but technology is a game changer, enabling underwriters to respond quickly and highlighting the importance of marketing support.

“It’s also important to make sure our reputation out there in the marketplace is representative of the Jencap way,” he adds. “I think reputation is a big factor.”

Meanwhile, Matt Grossberg, CEO of Integrated Specialty Coverages (ISC), another winner, refers to the list as “table stakes” that you need to be competitive in today’s market.

“We try to utilize our technology as much as we possibly can,” he says. “But it comes down to people and the people behind the scenes. We think we have some really special folks who know their products incredibly well, and we try to line up each product with an underwriter who’s best in class.”

 

How did the 5-Star Wholesale Brokers and MGAs beat the rest?

Grossberg and the ISC team can rest on their laurels with their IBA 5-Star awards, which include bronze medals for construction and hospitality specialties.

Grossberg attributes the wins to their proprietary technology platform.

“We have 37 developers and engineers on staff and a variety of data scientists who we use to bring in third-party datasets, which we ingest and clean, and we try and make it as easy as possible for brokers to submit business to us,” he explains. “Right now, you can bind and issue by answering about seven questions on our system. Our loss ratios show that we’re collecting enough data to drive loss ratios down at the same time. So, we’re really excited about it. We think we have a really good service platform and really talented individuals behind it. It’s nice to be acknowledged for it.”

Jencap captured bronze medals in general liability and small business, which Peddle corresponds to a concentration on optimizing business processes. Regarding small business, he says, “We’re really focused not only on the basics – broad market access, technical expertise and superior customer service – but also making sure all those things work well in terms of being able to turn around quotes quickly and bring policy documents back to the retail agencies in a timely manner.” As one of the top wholesale brokers in the country in 2022, Jencap wrote more than $3 million in premium.

Burrous was surprised to find out that J&J had won a silver medal for marine. Not that he doesn’t have high regard for the specialty, but because J&J has been devoting resources to other areas, such as a national flood program.

“Marine is still very important to us,” he says. “It’s a growing segment for us. We’ve had marine for many years; we’re just putting a few more resources into it now. We’re proud of what we do in the marine area. We have a growing marine business. And we will continue to expand with markets and personnel to push that here at J&J.”

J&J also won a Brokers’ Pick medal for homeowners insurance, followed by BTIS for general liability, Brown & Riding for professional liability, and Gorst & Compass for general liability.

“In the wholesale and MGA world, you want to be the one consolidating, not the one consolidated”



Peter Burrous, Johnson & Johnson

 

Longevity is key for the 2023 IBA 5-Star Wholesale Brokers and MGAs

IBA’s winners are concerned about another trend in the wholesale broker and MGA spaces: mergers and acquisitions (M&A).

“The M&A world is rampant,” says Burrous. “No one wants to be the part that got gobbled up.”

For J&J, it’s all about sustaining longevity. “We’re over 90 years old,” Burrous adds. “We intend to stay here and be family held, which we still are today. In the wholesale and MGA world, you want to be the one consolidating, not the one consolidated.”

Peddle and the Jencap team have a little different perspective.

“The consolidation has been obviously ongoing for years,” Peddle says. “Jencap was one of the most acquisitive companies out there in the wholesale space over the past seven years – with the change in the economic environment and interest rates and because of the changing dynamics. So, it will be interesting to see how that plays out.”

Grossberg adds, “I think the consolidation in the marketplace has been pretty overwhelming. There are a lot of private equity players now in the space, and their hold periods differ. Lots of different, unique opportunities are going to start to come up in the marketplace over the course of the next couple years. It’ll be interesting to see who emerges from those bigger and stronger and who comes together – it’s a transformational opportunity.”

“It’s also important to make sure our reputation out there in the marketplace is representative of the Jencap way. I think reputation is a big factor”



Bruce Peddle, Jencap

 

 

Evolving trends for wholesale brokers and MGAs

Most insurance products that address emerging or evolving risks tend to incubate in the wholesale, specialty and surplus lines segments. For example, one well-established line of coverage is property insurance.

“Risk profiles are impacted dramatically by Mother Nature,” Kelley says. “Losses arising from things like wildfires, flooding and windstorms constantly change the standard market’s risk appetite, which causes the ebb and flow of property insurance coverages between the standard and surplus lines markets.”

J&J provides niche policies in personal lines for homeowners, floods, and marine, and in commercial lines for property and casualty (P&C), marine, and environmental – all the way from Maine to Florida. Currently, conditions are firm.

“Markets are as tight as a drum right now – some of which no longer exist in Florida anymore,” says Burrous. “They reacted more than we anticipated with Hurricane Ian coming through Florida, basically shutting things down in terms of writing anymore in Florida, South Carolina, Georgia and North Carolina.”

And Peddle says the P&C marketplace continues to be firm, putting retailers in a position where they have to rely on the wholesale marketplace more and look for alternatives.

“It’s definitely the hardest market that I’ve lived through,” says Peddle. From a property cap perspective, he says, they’ve seen significant rate increases of 30% to 50% coupled with 50% to 100% increases in retentions. Appetites are tightening. And he doesn’t anticipate many changes in the near future.

Meanwhile, Grossberg echoes those sentiments.

“I see capacity drying up all over the place,” he explains. “A lot of capital is not coming into the business the way it was in the past. And I think that over time, we’ll continue to see capacity constraints leak from the cap markets into the property and general liability markets. We’re starting to see it.

“It’s a good and bad situation. We’re finally getting price adequacy in some lines of business, which has been eluding us as an industry. But we’ll see how long it lasts.”

“It comes down to people and the people behind the scenes. We think we have some really special folks who know their products incredibly well, and we try to line up each product with an underwriter who’s best in class”



Matt Grossberg, Integrated Specialty Coverages

 

Ability to place niche or emerging risks

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Nationwide Brokerage Solutions

  • Socius

 

Compensation (commissions, bonuses, profit sharing, etc.)

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Kraft Lake Insurance Agency

  • Nationwide Brokerage Solutions

  • Novatae Risk Group

  • Socius

 

Geographical reach

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Nationwide Brokerage Solutions

  • Novatae Risk Group

  • Socius

 

Marketing support

  • BTIS

  • Jimcor Agencies

  • Nationwide Brokerage Solutions

  • Novatae Risk Group

  • Socius

 

Overall responsiveness

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Kraft Lake Insurance Agency

  • Novatae Risk Group

  • Socius

 

Pricing

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Kraft Lake Insurance Agency

  • Nationwide Brokerage Solutions

  • Novatae Risk Group

  • Socius

 

Range of products

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Kraft Lake Insurance Agency

  • Nationwide Brokerage Solutions

  • Socius

 

Reputation

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Kraft Lake Insurance Agency

  • Nationwide Brokerage Solutions

  • Socius

 

Technical expertise and product knowledge

  • Bass Underwriters

  • BTIS

  • CRC Group

  • Jimcor Agencies

  • Kraft Lake Insurance Agency

  • Nationwide Brokerage Solutions

  • Novatae Risk Group

  • Socius

 

Technology or automation

  • BTIS

  • Jimcor Agencies

  • Kraft Lake Insurance Agency

  • Nationwide Brokerage Solutions

  • Socius

 

All-Stars

 

Specialization

Cannabis

 

Commercial auto/transportation/trucking

 

Construction

 

Contractors

 

Directors and officers

  • Socius

    Gold

  • CRC Group

    Silver

 

Environmental

 

General liability

 

High net worth

 

Hospitality

 

Management liability

  • CRC Group

    Gold

  • Socius

    Silver

 

Marine

 

Non-profit

 

 

Professional liability

  • CRC Group

    Silver

  • Socius

    Bronze

 

Program business

 

Property (commercial)

  • CRC Group

    Silver

  • Tapco Underwriters

    Bronze

 

Real estate

 

Small business

 

Workers’ compensation

 

Brokers’ Pick

 

Insurance Business America conducted a survey of retail producers nationwide to determine the best businesses in the wholesale distribution channel. The survey asked respondents to rate the performance and service of each of their wholesale partners on a scale of 1 (poor) to 5 (excellent) against the following 10 criteria:

      • Ability to place niche or emerging risks

      • Compensation (commissions, bonuses, profit sharing, etc.)

      • Geographical reach

      • Marketing support

      • Overall responsiveness

      • Pricing

      • Range of products

      • Reputation

      • Technical expertise and product knowledge

      • Technology or automation

The wholesale brokers and MGAs that earned an average score of 4 or greater in at least one category were awarded a 5-Star designation. Wholesale partners that received an average score of 4 or greater in all categories received an All-Star designation.

Brokers were also asked to rank their top three wholesale brokers and MGAs across 18 major types of insurance. Brokers also named the top insurance products offered by an MGA.

Based on brokers’ feedback, IBA calculated the top three winners for each type of insurance and awarded gold, silver and bronze medals to those wholesale brokers and MGAs. The four insurance products that received the most votes from brokers were awarded the Brokers’ Pick medal.



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NY to mandate MJ cover

by | Mar 22, 2023 | Insurance


New York legislators have passed a bill that would mandate public health insurance providers in the state to cover medical marijuana as a prescription drug and allow private insurers to do the same if they wish.

The Assembly Health Committee approved the legislation, spearheaded by Majority Leader Crystal Peoples-Stokes (D), in an 18-7 vote on Tuesday. The bill will now move to the Ways & Means Committee before potentially progressing to the floor.

This legislation would revise state law to categorize cannabis as a “prescription drug,” “covered drug,” or “health care service” for insurance purposes. Public insurance entities would be required to cover medical marijuana, regardless of any federal financial involvement in their services.

State Medicaid, Child Health Plus, workers’ compensation, and EPIC programs would need to treat cannabis obtained from certified dispensaries in the same way as other conventional pharmaceuticals in terms of coverage.

While private health insurers would not be obligated to cover medical marijuana, the bill makes it clear that they may do so if they decide to.

Additionally, the bill text states that the commissioner of the state Department of Health would be authorized to “certify a dispensing site… as a medical assistance provider, exclusively for the purpose of dispensing medical marijuana.”

A corresponding Senate bill from Sen. Jeremy Cooney (D) has been directed to the Health Committee of that chamber, although no action has been scheduled yet.

Previously, the Senate approved an earlier iteration of the legislation, but it failed to progress through the Assembly before the session concluded. In a prior session, a comparable proposal was introduced in the Assembly, but it did not advance beyond the committee stage.

There are now 66 marijuana dispensaries licensed in the state, two of them are in Manhattan.

Where is marijuana legal in the US?























































State

Legal Status

Medicinal

Decriminalized

Alabama

Mixed

Yes

No

Alaska

Fully Legal

Yes

Yes

Arizona

Fully Legal

Yes

Yes

Arkansas

Mixed

Yes

No

California

Fully Legal

Yes

Yes

Colorado

Fully Legal

Yes

Yes

Connecticut

Fully Legal

Yes

Yes

Delaware

Mixed

Yes

Yes

District of Columbia

Fully Legal

Yes

Yes

Florida

Mixed

Yes

No

Georgia

Mixed

CBD Oil Only

No

Hawaii

Mixed

Yes

Yes

Idaho

Fully Illegal

No

No

Illinois

Fully Legal

Yes

Yes

Indiana

Mixed

CBD Oil Only

No

Iowa

Mixed

CBD Oil Only

No

Kansas

Fully Illegal

No

No

Kentucky

Mixed

CBD Oil Only

No

Louisiana

Mixed

Yes

Yes

Maine

Fully Legal

Yes

Yes

Maryland

Mixed

Yes

Yes

Massachusetts

Fully Legal

Yes

Yes

Michigan

Fully Legal

Yes

Yes

Minnesota

Mixed

Yes

Yes

Mississippi

Mixed

Yes

Yes

Missouri

Fully Legal

Yes

Yes

Montana

Fully Legal

Yes

Yes

Nebraska

Fully Illegal

No

Yes

Nevada

Fully Legal

Yes

Yes

New Hampshire

Mixed

Yes

Yes

New Jersey

Fully Legal

Yes

Yes

New Mexico

Fully Legal

Yes

Yes

New York

Fully Legal

Yes

Yes

North Carolina

Fully Illegal

No

Yes

North Dakota

Mixed

Yes

Yes

Ohio

Mixed

Yes

Yes

Oklahoma

Mixed

Yes

No

Oregon

Fully Legal

Yes

Yes

Pennsylvania

Mixed

Yes

No

Rhode Island

Fully Legal

Yes

Yes

South Carolina

Fully Illegal

No

No

South Dakota

Mixed

Yes

No

Tennessee

Mixed

CBD Oil Only

No

Texas

Mixed

CBD Oil Only

No

Utah

Mixed

Yes

No

Vermont

Fully Legal

Yes

Yes

Virginia

Fully Legal

Yes

Yes

Washington

Fully Legal

Yes

Yes

West Virginia

Mixed

Yes

No

Wisconsin

Mixed

CBD Oil Only

No

Wyoming

Fully Illegal

No

No

 



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PartnerRe slides to full-year loss

PartnerRe slides to full-year loss

by | Mar 22, 2023 | Insurance



PartnerRe slides to full-year loss

Results season continues with the turn of PartnerRe, whose earnings report is a mixed bag.

According to the reinsurer, here’s how it fared in the quarter and year ended December 31, 2022:









Metric

Q4 2022

Q4 2021

FY 2022

FY 2021

Non-life underwriting profit

$368 million

$313 million

$749 million

$507 million

Life & health allocated underwriting profit

$29 million

$32 million

$121 million

$97 million

Net investment return

$306 million

$156 million

$(1.56 billion)

$541 million

Operating income

$370 million

$300 million

$809 million

$545 million

Net income/(loss) attributable to common shareholders

$433 million

$362 million

$(1.1 billion)

$679 million

 

PartnerRe attributed its 2022 loss to net unrealized losses on fixed maturities and short-term investments worth $1.81 billion. 

Highlighting the positives, however, PartnerRe president and chief executive Jacques Bonneau said in a release: “Our operating performance for the fourth quarter of 2022 was excellent, with operating income of $370 million. Our annual operating performance also maintained its positive momentum, and operating income ROE (return on equity) was 12.0% for the year.

“In addition to solid underwriting results, during 2022 we grew net investment income by almost 6% as we continued to reinvest available cash at rates that are meaningfully higher than our existing book yield.”

For 2022, dividends declared and paid to common shareholders of PartnerRe amounted to $178 million. There were no dividends during the fourth quarter.



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