Convex Group’s third-quarter net income fell by almost 45 per cent as the Bermudian-based specialty re/insurer reported a weaker underwriting margin, despite ongoing premium growth.

The company said net income attributable to common equity was $132 million for the three months ended September 30, down from $238 million in the same quarter last year.

Gross premium written increased by $229 million, or almost 20 per cent, to $1.396 billion. Net written premium rose to $920 million from $813 million, while net premium earned increased to $980 million from $905 million.

However, Convex’s combined ratio — the industry measure of underwriting profitability — weakened to 92.7 per cent from 79.3 per cent a year earlier. A ratio below 100 per cent means an underwriting profit.

The result was also weaker than the 85 per cent combined ratio reported for the second quarter, when Convex recorded net income of $169 million.

Convex did not provide a breakdown of the movement in its combined ratio or a reason for the lower quarterly income in its two-page results release.

For the 12 months to September 30, the company reported gross premium written of $6.357 billion, up from $5.882 billion in the comparable prior-year period.

Net income over the period was $613 million, excluding $41 million in one-off transaction costs related to the acquisition of Convex by Onex Corporation and American International Group. That was up from $566 million a year earlier, although it was below the $719 million reported for the 12 months to June 30.

The LTM combined ratio was 87 per cent, compared with 89.9 per cent a year earlier, which means that underwriting profit was stronger than in the previous 12-month period despite the weaker quarter.

Convex, founded in 2019 by Stephen Catlin and Paul Brand, operates in Bermuda, London, Luxembourg and New Jersey and writes specialty re/insurance business.

Onex purchased a 63 per cent stake in Convex in February, while AIG acquired an approximately 35 per cent interest. The transaction valued Convex’s common equity at $7 billion and was meant to secure the company’s long-term independence and support its next stage of expansion.

Convex has also pursued expansion beyond its existing underwriting platforms. In June, it announced the launch of Kinetic Insurance Services, a UK-based managing general agency expected to begin trading in the fourth quarter.