22nd May 2014 08:52
LONDON (Alliance News) - Amlin PLC Thursday reported a 12% increase in net written premiums in the first quarter, driven by gross growth and a reduction in reinsurance expenditure.
In a statement, Amlin said net written premium increased to GBP1.05 billion in the three months ended March 31, compared with GBP938.3 million in the corresponding quarter a year earlier.
Gross written premium increased to GBP1.28 billion, up from GBP1.22 billion, driven by its London, Bermuda and Europe reinsurance divisions.
However, Amlin noted "clear evidence" of increasing competition in a number of business lines, most notably catastrophe reinsurance.
Nevertheless, Amlin said it is still possible to achieve good margins and said it grew catastrophe reinsurance gross written premium by 3.7%, while recording an average renewal rate decline of 8.8%. US catastrophe renewal rates reduced by an average of 10.3%, while international catastrophe renewals experienced average rate decreases of 7.3%.
Amlin said it believes its rate reductions to be smaller than the catastrophe reinsurance market as a whole.
Amlin said reinsurance expenditure fell to GBP226.8 million from GBP276.7 million, due to the closure of one of its special purpose syndicates. In addition, Amlin said it has decided to internalise a number of its programmes and expects a full-year saving of about GBP70.0 million in reinsurance expenditure.
Amlin said catastrophe loss activity was limited, while there were few large risk losses.
"We continue to benefit from the strength of our reinsurance franchise and our partnership with Leadenhall Capital, which are creating new opportunities for Amlin as the market evolves. Elsewhere, the quality and diversity of our portfolio and our investment in broadening the footprint of Amlin's business, continue to offer scope for long-term profitable growth," Charles Philipps, chief executive, said in a statement.
Amlin has been targeting synergies between its reinsurance business and Leadenhall Capital Partners, a London-based investment manager that invests in insurance-linked investments. Amlin has a 40% stake in Leadenhall.
In early March, Philipps said Amlin expects to increase its stake in Leadenhall, either in part or in full, during 2014.
Amlin shares were Thursday quoted at 456.90 pence, down 0.3%.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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