Axis books $116m profit as catastrophes take toll
Bermudian-based Axis Capital Holdings Ltd has reported first-quarter net income available to common shareholders of $116 million, or $1.36 per diluted common share.
That compares to a net loss attributable to common shareholders of $185 million, or $2.20 per diluted common share, for the first quarter of 2020.
The company reported operating income for the period of $83 million, or 97 cents per diluted common share, compared to an operating loss of $164 million, or $1.94 per diluted common share, for the first quarter of 2020.
Gross premiums written increased by $104 million, or four per cent ($72 million or three per cent on a constant currency basis), to $2.5 billion with an increase of $162 million, or 17 per cent, in the insurance segment, partially offset by a decrease of $58 million, or four per cent, in the reinsurance segment.
Net premiums written increased by $100 million, or six per cent ($68 million or four per cent on a constant currency basis) to $1.8 billion, with an increase of $126 million, or 22 per cent, in the insurance segment, partially offset by a decrease of $26 million, or two per cent, in the reinsurance segment.
There was an improvement of 4.3 points in current accident year combined ratio, excluding catastrophe and weather-related losses, compared to the prior year.
Pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums, were $110 million ($100 million, after-tax), including $36 million in the insurance segment and $74 million in the reinsurance segment.
The company said the losses were primarily attributable to Winter Storms Uri and Viola, principally related to the state of Texas, and other weather-related events this quarter, compared to $300 million in 2020, which included $235 million, or 21.3 points, attributable to the Covid-19 pandemic.
Axis said there was no change to net loss estimate of $360 million established for the Covid-19 pandemic in 2020.
Net investment income of $114 million increased from net investment income of $93 million for the first quarter of 2020.
Albert Benchimol, president and CEO, said: “In the first quarter of 2021, our industry was again impacted by significant climate events and our primary thoughts are with the people and communities that have been affected. We are focused on supporting the recovery efforts and fulfilling our purpose – to help people when they are down.
"Notwithstanding the substantial catastrophe activity, this was a good quarter for Axis and one where we saw tangible proof that our efforts to reposition our portfolio are generating real traction. Our first quarter results were highlighted by a year-over-year reduction of 4.3 points to our current accident year combined ratio ex-cat and weather, with improvements seen in both segments.
"These metrics provide further evidence that our re-underwriting actions are delivering the desired impact. Our insurance segment's combined ratio of 94 per cent and our ability to generate a consolidated 99 per cent combined ratio in light of notable cat and weather activity speak to the progress that we’re making.
"With market conditions favourable across virtually all of our lines of business, our performance is seeing positive momentum as the global economy continues to recover. We have a strong franchise, deep relationships with our brokers and partners in distribution, and leadership positions across our most attractive markets. We believe Axis is poised to continue to demonstrate meaningful improvements to our performance in 2021 and beyond.”