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Omega’s premium revenue slumps

Bermuda-based insurer Omega Insurance Holdings Ltd reported a $50 million decrease in gross written premium (GWP) in the first nine months of 2011, but says it is positioned for future growth and improving rates.

The company’s 2011 GWP totalled $258.5 million, down $50 million, from $308.5 million during the same period in 2010.

According to a company nine-month interim management statement released on Friday, while rates are improving in Omega’s two largest classes, property catastrophe and US small commercial property, the company’s net loss estimates for 2011 catastrophes have increased by $6 million.

“Although the market has been slow to react to significant recent losses and low investment yields, we are encouraged by upward pricing in property catastrophe and SME (small and medium-sized enterprises) markets,” said the company.

Of Omega’s three operating segments, only one Omega US Insurance saw growth, increasing its GWP 10.8 percent to $38.9 million during the first three quarters of 2011, up from $35.1 million in 2010.

“The rating environment in the US excess and surplus lines has begun to improve,” Omega stated. “The business is well positioned for growth now that we are licensed in all US states. We expect continued rate increases throughout 2012.”

The company is currently in the final stages of regulatory approval for Haverford (Bermuda) Ltd’s offer for up to 25 percent of Omega’s outstanding shares, which has been put to shareholders.

If Haverford is successful, its chairman and Flagstone Re co-founder Mark Byrne will become Omega’s executive chairman.

Omega’s group participation on and reinsurance of Syndicate 958 decreased by 8.9 percent to $188 million from $206.4 million in 2010, a fall that reflects exits from marine energy and retrocessional classes of business, the company said.

The company’s Bermuda underwriting platform Omega Specialty, located on Par La Ville Road, was particularly hard hit seeing their GWP reduced by 52.8 percent to $31.6 million from $67 million in 2010. The company states that these figures reflect “the previously announced changes in the underwriting strategy of the direct business written in Bermuda”.

Omega puts their estimated third-quarter catastrophe losses at $10 million stemming from August’s Hurricane Irene, Texas wildfires and Canada’s arson fire at Slave Lake. The group, however, doesn’t expect material losses from the heavy Thailand flooding.

“2011 has been impacted by an unusually high occurrence of smaller US and international catastrophes, resulting in an increase in attritional losses of approximately $9 million,” the statement added.

Omega: Premium revenue fell $50 million

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Published November 21, 2011 at 1:00 am (Updated November 21, 2011 at 8:37 am)

Omega’s premium revenue slumps

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