Catlin posts $432M profit for 2013

Catlin Group Ltd. posted a pretax profit of $432 million for 2013, a 27% increase over that posted in 2012, the specialty insurer and reinsurer said Monday.

Hamilton, Bermuda-based Catlin said that while it incurred $156 million in catastrophe losses during the year, its loss ratio was 52.3% — its lowest since 2007.

Its combined ratio for 2013 was 85.6% compared with 90.0% in 2012, Catlin said. Reserve releases of $167 million helped improve the combined ratio, the company said.

Gross written premiums increased 7% to $5.31 billion in 2013, compared with $4.97 billion in 2012, while net investment income for 2013 was $124 million, down from $158 million a year previously, Catlin said.

Market conditions are becoming more competitive in many of the insurance and reinsurance lines the company underwrites, but CEO Stephen Catlin said in a statement that he remains confident margins on that business are still strong.

In a briefing note Monday, analysts at Berenberg Bank said Catlin is “well positioned” to remain profitable during a softening market cycle.

Average weighted premium rates across its underwriting portfolio increased 0.8% during 2013 compared with a 4.0% increase in 2012, Catlin said. On average, premium rates for catastrophe-exposed business classes fell 0.2% while they increased an average of 1.3% for non-catastrophe-exposed business.

For aerospace business, average weighted premium rates fell 8% in 2013, while they rose 6% for casualty business, remained stable for energy and marine business, rose 2% for property business, remained flat for reinsurance, and fell 1% for specialty/war and political risk business.