18th Feb 2016 07:47
LONDON (Alliance News) - Lancashire Holdings Ltd on Thursday said it expects current market trends to continue during 2016, with more pricing pressure, albeit at a slower rate, although the non-life insurer has been able to cut its exposures through reinsurance.
According to Chief Financial Officer Elaine Whelan, that leaves Lancashire "well positioned" for the current phase of the cycle.
"We are comfortable that at our current capital level we are able to write the business we want to and be ready for any opportunities that may materialise," Whelan said.
The outlook came as Lancashire announced plans to pay a standard final ordinary dividend of 10 US cents per share. Including its interim dividend of USD0.05 and a special dividend of USD0.95, Lancashire has returned 128.6% of comprehensive income for the year, Whelan said. The final and interim dividend matched those declared for the prior year, but the special component fell from USD1.70.
Lancashire said pretax profit fell to USD171.7 million in 2015, from USD226.5 million the prior year, the company said, as gross written premiums dropped to USD641.1 million from USD907.6 million and net investment income edged up to USD29.8 million from USD28.6 million. Total expenses fell to USD424.3 million from USD514.5 million, helped by lower insurance losses.
The group's combined ratio, a measure of underwriting profitability, improved to 72.1% from 68.7%.
Meanwhile, Lancashire said Martin Thomas will stand down as chairman in May, following over nine years on the board. Peter Clarke, a former chief executive of FTSE 250 hedge fund manager Man Group PLC, and currently an independent non-executive director at Lancashire, will succeed Thomas as the insurer's first new chairman since 2007.
"The Lancashire board has led by example on this count and with three women among our eight directors, Lancashire is within the top ten FTSE 250 boards in terms of its gender diversity. After nine years, it is the right time for a change, both for the business and for me," Thomas said.
"Having served as a director for over a year it is a pleasure to be able to take on the chairmanship of the Lancashire board. I would first like to thank Martin for his central role in building Lancashire as a successful business over many years, and I look forward to working closely with Alex, my other colleagues on the board and everyone within the business, in ensuring that Lancashire remains a nimble and dynamic business capable of delivering sector leading returns," Clarke said.
By Samuel Agini; [email protected]; @samuelagini
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