IMS for the nine months ended 30 September 2014

RNS Number : 2776W

Beazley PLC

06 November 2014

 



Press

Release

Beazley plc interim management statement for the nine months ended 30 September 2014.

Dublin, 6 November 2014

Overview

·      Premium rates on renewal business decreased by 1%

·      Premiums remained stable at $1,546m (2013: $1,543m)

·      Annualised investment yield of 1.9%

Andrew Horton, Chief Executive Officer, said: 

"We continue to see opportunities in our locally underwritten US business, with its focus on small and mid-market risks, where we have grown premiums 17% year on year.  Competition is intensifying in large risk and catastrophe exposed, short tail lines, where we are maintaining our underwriting discipline.  This is to be expected given the generally benign claims environment experienced in recent periods."

	30 Sep 2014	30 Sep 2013	% increase/Decrease
Gross premiums written ($m)	1,546	1,543	-
Investments and cash ($m)	4,410	4,354	1%
Investment return - annualised (%)	1.9%	0.8%	-
Rate (decrease)/increase	(1%)	1%	-

Premiums

Gross premiums written for the nine months ended 30 September are in line with the equivalent period of 2013. Our largest division, specialty lines, wrote $627m in the period which represents growth of 5% relative to the first nine months of 2013.  This premium growth has helped to offset the competitive trading conditions some of our other teams have encountered.

Our performance to the end of September 2014 by business division is:

	Gross premiums written 30 Sep 2014	Gross premiums written 30 Sep 2013	% increase / (decrease)	Q3 2014 Rate change
	$m	$m	%	%
Life, accident & health	110	81	36	11
Marine	254	256	(1)	(6)
Political risk & contingency	89	103	(14)	(3)
Property	269	293	(8)	(1)
Reinsurance	197	214	(8)	(10)
Specialty lines	627	596	5	1
OVERALL	1,546	1,543	-	(1)

Rates on renewal business decreased by 1% across the portfolio as a whole.  Rates in specialty lines rose by 1% compared to the prior year, while we secured significant rate increases in our life, accident and health division following the losses experienced in 2013.  Rate pressure continues to be most evident in our large risk, catastrophe exposed lines of business such as reinsurance and marine.

Business update

We continue to invest in our underwriting divisions, and our US platform has experienced growth in locally underwritten premium of 17% in the first nine months of the year, following a similar rate of growth in 2013.  In Europe, Julia Popper has joined Beazley to head up our business development team in Paris.  We have also opened our office in Dubai and expect to bind our first premium through this office in the coming months.

In the last quarter, Stuart Simpson joined Beazley as our Senior Investment Officer.  We have also completed the re-structuring of our relationship with Falcon Money Management Limited.

Claims update

Overall, claims have developed favourably during 2014.  Provided that claims continue to develop in line with our expectations for the remainder of the year, we are on target to deliver a strong result and a combined ratio in line with our long term average.

Investments

As at the end of September our portfolio allocation was as follows:

	30 Sep 2014		30 Sep 2013
	Assets	Allocation	Assets	Allocation
	$m	%	$m	%
Cash and cash equivalents	313	7.1	613	14.1
Fixed income: sovereign and supranational	2,017	45.7	2,103	48.3
Investment grade credit	1,475	33.5	1,058	24.3
Other credit	67	1.5	97	2.2
Core portfolio	3,872	87.8	3,871	88.9
Capital growth assets	538	12.2	483	11.1
Overall portfolio	4,410	100.0	4,354	100.0

Investment income for the nine months to 30 September 2014 was $62.4m, representing an annualised return of 1.9% (2013: 0.8%).  The weighted average duration of our fixed income portfolios (including cash, government bonds and credit investments) is 22 months at 30 September 2014 (30 June 2014: 20 months). 

Capital management

We remain committed to active capital management and we will provide a further update at the year end.

ENDS

 For further information, please contact:

Beazley plc

Sian Coope

 [phone]

Note to editors:

Beazley plc (BEZ.L), is the parent company of specialist insurance businesses with operations in Europe, the US, Asia and Australia.  Beazley manages five Lloyd's syndicates and, in 2013, underwrote gross premiums worldwide of $1,970.2 million.  All Lloyd's syndicates are rated A by A.M. Best. 

Beazley's underwriters in the United States focus on writing a range of specialist insurance products.  In the admitted market, coverage is provided by Beazley Insurance Company, Inc., an A.M. Best A rated carrier licensed in all 50 states.  In the surplus lines market, coverage is provided by the Beazley syndicates at Lloyd's.

Beazley is a market leader in many of its chosen lines, which include professional indemnity, property, marine, reinsurance, accident and life, and political risks and contingency business.

For more information please go to: www.beazley.com

 

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