Maiden Holdings Ltd made a loss of $22.4 million, or $0.26 per common share, for the second quarter.

That compared to a $30.9 million profit for the same period of 2016.

Art Raschbaum, chief executive officer of the Bermudian-based company, said: “The emergence of adverse loss development in both of our key operating segments has impacted our second quarter 2017 results.

“We do not believe that the development observed in the quarter is analogous to the trend observed across our portfolio over recent quarters, which specifically emanated from elevated commercial auto liability frequency and severity from the 2011-2014 underwriting years, a phenomenon which has plagued many in the industry.”

The net adverse development for the quarter in the AmTrust reinsurance segment was $29.4 million.

Mr Raschbaum added: “While the AmTrust reinsurance segment adverse development is relatively modest in the context of the overall historical portfolio assumed, as we have committed to in the past, it is our practice to respond to confirmed adverse development promptly.

“In response to observed elevated claims activity which we noted in our first-quarter earnings call, Maiden’s audit activity has confirmed claims operational changes in AmTrust’s US small commercial lines business which are believed to have contributed to a portion of the increased emergence in related casualty lines.

“We have however increased our reserves in these lines in the quarter in response to elevated severity in specific jurisdictions.”

There was also adverse development of $25.4 million in the company’s diversified reinsurance segment’s casualty facultative business.

Mr Raschbaum said: “Despite the adverse development in the quarter, year-to-date treaty commercial auto which has been the source of significant development over many recent quarters, has been benign, giving us increasing comfort that we have addressed this issue.”

He noted that most recent underwriting years continue to perform within expectations, adding: “We did benefit from strong investment income, up 14.7 per cent from the prior year period driven by increased investable assets. Absent adverse development, this will improve both return on equity and operating results in future quarters.”

In the second quarter, gross premiums written increased 2.5 per cent to $705.2 million, while gross premiums written in the diversified reinsurance segment were down 14.6 per cent at $140.8 million.

The combined ratio for the second quarter rose to 105.8 per cent, from 98.6 per cent a year ago.

Book value per common share was $11.65, a decrease of 1.4 per cent compared to the year-end 2016.

In June, Maiden redeemed its $100 million 8 per cent senior notes due 2042, and issued $150 million 6.7 per cent non-cumulative preference shares.

Before the earnings report was released Maiden’s shares closed at $10.56 in New York, down 45 cents, or 4.09 per cent.