Watford strengthens loss reserves
Watford Holdings has strengthened its loss reserves by about $28 million and expects to report a fourth-quarter net loss as a result.
The Bermudian-based insurer and reinsurer said the loss reserve strengthening is in response to higher than projected reported losses in the quarter, mainly in US casualty reinsurance, as well as known casualty exposures where losses are believed to have been incurred but, for the most part, have yet to be reported.
The reserve increase primarily relates to two large casualty reinsurance contracts, one of which is in run-off, and one of which has been renewed at increasingly smaller participations over the past several years.
In addition, catastrophe losses will impact the company’s fourth-quarter underwriting results by approximately $5 million.
Despite the reserve increase, the company expects to report positive growth in book value per share in excess of 3 per cent for the quarter after reflecting strong investment income and the impact of share repurchases.
Watford will release its fourth-quarter results after the close of business on Tuesday, February 11.
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