Hurricanes and storms have knocked 43 per cent off Lloyd’s insurer Beazley’s profits for 2017.
Beazley said on Thursday that its pre-tax profits fell from $293m to $168m after it paid out claims on last autumn’s natural catastrophes, which included hurricanes Harvey, Irma and Maria. The group’s return on equity halved to 9 per cent for the year.
In September, the London-based insurance company and underwriter issued a profit warning, estimating that earnings would be around $150m lower because of the claims, before taking into account the impact of the California wildfires which took place in October.
The cost of the hurricanes was partly offset by higher releases of reserves set aside in previous years and a stronger performance from the group’s investment portfolio.
Beazley pushed up its full year dividend by 6 per cent to 11.1p per share, but there was no repeat of last year’s 10p per share special dividend.
Beazley chief executive Andrew Horton said on Thursday:
Beazley achieved an underwriting profit in 2017, a year in which hurricanes, earthquakes and wildfires generated heavy claims for the insurance industry. More importantly, we delivered on our commitments to our policyholders, already paying out more than $110m in claims following the year’s natural catastrophes. Premiums grew 7 per cent in 2017 — a strong performance given market conditions. Looking ahead, we see potential for double-digit growth in 2018.
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