Interim Management Statement

RNS Number : 3653U

Amlin PLC

14 May 2008

 



Amlin plc

PRESS RELEASE

For immediate release

14 May 2008

Interim Management Statement for 19 week period to 13 May 2008

Amlin plc is today publishing its first Interim Management Statement as required by the UK Listing Authority's Disclosure and Transparency rules, relating to the period from 1 January to 13 May 2008.

Trading environment

The trading environment is not materially different to that described in our recent AGM Statement.  As reported, rates for 2008 have continued to soften in our Non-marine, Marine and Bermudian businesses although margins remain acceptable as rates come off historic peaks. Our UK Commercial and Aviation lines are well positioned to benefit from an anticipated upturn, when it comes.  Overall, the renewal rate reduction across the Group for the four months to 30 April 2008 was 7.9% with renewal retention at 86%. This is analysed by division in the table below:

	2008 gross written premium  to 30 April	Renewal rate change	Renewal retention ratio
	£ million	%	%
Non-marine	249.1	(10.8)	85
Marine	118.2	(3.2)	84
Aviation	24.3	(1.7)	83
UK Commercial	48.1	(2.9)	77
Amlin Bermuda	84.5	(8.7)	94
Total /Average	524.2	(7.9)	86

Gross written premium (before deduction of brokerage) (see note below)  incepting in the first four months ended 30 April 2008 was £524.2 million (2007: £577.9 million at April 2008 rates of exchange), 9.3% less than in the prior period.

Syndicate 2001 generated £439.7 million of gross written premium, a reduction of 13.0% at comparable exchange rates. The bulk of the decrease originated from our Non-marine and UK Commercial divisions, reflecting challenging market conditions.  Of this income, £21.4 million, or 4.9%, was specifically written to be ceded to Amlin Bermuda, with up to an additional 12.5% ceded through the renewal of a whole account quota share reinsurance contract.

Amlin Bermuda contributed a further £84.5 million ($167.2 million) of direct gross written premium in the period, in addition to the reinsurances of Syndicate 2001 noted above. This represents a relative increase of 16.2% at comparable rates of exchange to the same period in 2007.

Claims development and reserves

There have been no major claims affecting the group beyond those described in the AGM Statement on 24 April.  Due to our limited Chinese property reinsurance exposure we do not expect to receive material claims notifications for the Chinese earthquake on 12 May. 

At 31 March 2008, following the normal quarterly review of outstanding liabilities, 
£31.2 million (31 March 2007: £21.6 million) was released from reserves with claims development again better than expected.  Our reserving policy remains unchanged.

Investment returns and position

The Group's investments have continued to be defensively positioned. Following further deterioration in liquidity conditions in the credit markets in the first quarter, April saw some improvement in conditions, which resulted from continued Central Bank intervention. As a consequence, equity prices increased and government bond prices fell. Equity options in place through the year end expired at 31 March 2007.  By close of business on 13 May approximately 20% of the Group's equity exposure was hedged with zero cost 95% put and call options.

The investment return for the four month period to the end of April is estimated to be 1.3%, with average funds under management of £2.5 billion.  

Share buy back programme

As communicated in our AGM Statement we have commenced a share buy-back programme.  In the period from commencement to 13 May 2008 we purchased 2.3 million shares at an average price of 264.2p per share.

Traded insurance risk venture

On 6 May, the Group announced its intention to form a new investment management joint venture.  The new venture, which is subject to FSA authorisation, will manage funds focused in traded insurance risk.

Note:

Gross written premium relates to policies both written and incepting on or before 30 April 2008.

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Enquiries:                                            

Charles Philipps, Amlin plc	0207 746 1000
Richard Hextall, Amlin plc	0207 746 1000
Hannah Bale, Head of Communications, Amlin plc	0207 746 1000
David Haggie, Haggie Financial LLP	0207 417 8989
Peter Rigby, Haggie Financial LLP	0207 417 8989 / 07803 851426

 

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