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Investment gains at White Mountains

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White Mountains Insurance Group Ltd, the Bermuda-domiciled financial services holding company, has reported comprehensive income attributable to common shareholders was $139 million and $66 million in the second quarter and first six months, respectively of 2021.

That compares with income of $116 million and a loss of $17 million in the second quarter and first six months of 2020, respectively.

The company said results in the second quarter and first six months of 2021 were driven primarily by $113 million and $71 million of net realised and unrealised investment gains from White Mountains's investment in MediaAlpha, the American insurtech firm.

White Mountains reported book value per share of $1,279 and adjusted book value per share of $1,292 as of June 30.

Book value per share and adjusted book value per share both increased four per cent in the second quarter of 2021 and two per cent in the first six months of 2021, including dividends.

Manning Rountree, chief executive officer of White Mountains, said: "We had a strong second quarter. Adjusted book value per share was up four per cent, driven by solid results across our operating companies as well as the increase in MediaAlpha's share price during the quarter.“

Build America Mutual is a mutual bond insurance company operated for the benefit of its members – the cities, states and other municipal entities that use BAM’s financial guaranty to lower their cost of borrowing.

BAM is the official provider of bond insurance for the National League of Cities, and was launched in 2012 with initial capital provided by subsidiaries of White Mountains.

Mr Rountree said: “BAM produced $30 million of total premiums and member surplus contributions, as insured penetration and market share remained strong, while pricing declined.”

White Mountains last year invested in Ark Insurance Holdings Ltd, the ultimate parent company of Ark Syndicate Management Limited. Ark manages the underwriting of syndicates 4020 and 3902 at Lloyd's.

Mr Rountree stated: “Ark wrote $328 million of gross written premiums, up 78 per cent year-over-year, and produced an 84 per cent adjusted combined ratio.”

NSM Insurance Group is the company’s speciality insurance program administrator.

Mr Rountree remarked: “NSM generated nice growth in both pro forma controlled premiums and pro forma adjusted EBITDA.

“Kudu (capital provider to asset management and wealth management firms) also posted nice growth in adjusted EBITDA and recognised $28 million in unrealised gains in the fair value of its portfolio of participation contracts.

“Excluding MediaAlpha, our investment portfolio returned 2.4 per cent in the quarter. We finished the second quarter with roughly $300 million in undeployed capital. We expect undeployed capital will increase in the third quarter upon completion of the subordinated debt raise at Ark."

MediaAlpha provides property & casualty insurance customer acquisition solutions.

White Mountains is a Bermuda-domiciled financial services holding company traded on the New York Stock Exchange and the Bermuda Stock Exchange under the symbol WTM.

Manning Rountree, CEO of White Mountains Insurance Group

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Published August 06, 2021 at 12:26 pm (Updated August 07, 2021 at 2:24 pm)

Investment gains at White Mountains

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