W.R. Berkley reports lower profit as pandemic takes toll

W.R. Berkley Corp.’s profit plummeted in the second quarter of 2020 as coronavirus-related losses hit the insurer and investment income fell.

The Greenwich, Connecticut-based company reported second-quarter net income of $71.3 million on Tuesday, compared with $216.7 million in the same period in 2019.

Berkley previously reported that its results would be hurt by $145 million in catastrophe losses, including $85 million in losses related to the COVID-19 pandemic.

In addition, second-quarter net investment income fell to $85.4 million, compared with $188.3 million in the same period last year.

“Net investment income was adversely impacted by a $58 million loss from investment funds, which are reported on a one-quarter lag. The loss was driven by the first quarter downturn in the financial markets resulting from the COVID-19 related economic shutdown,” a Berkley statement said.

Gross premiums written increased 2% to $2.13 billion.

Net premiums written edged down less than 0.5% to $1.74 billion. The insurer’s workers compensation business saw the sharpest drop in revenue with net written premium falling 19.8% to $273 million.

“Average rate increases excluding workers compensation in the second quarter of 2020 of approximately 13% mitigated the top-line impact of the shrinking economy,” the Berkley statement said.

The insurer reported a 2020 second-quarter combined ratio of 98.7%, compared with 93.9% in the 2019 quarter.

More insurance and risk management news on the coronavirus crisis here.