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Aspen Insurance Holdings Ltd. reported net income of $87.4 million for the six months ended June 30, 2021, helped in part by the sector’s strong pricing, compared with a net loss of $172.8 million in the six months ended June 30, 2020.
Strong pricing conditions for commercial insurers and reinsurers should persist for some time, according to Mark Cloutier, group executive chairman and CEO, speaking Tuesday to Business Insurance as Aspen reported earnings results.
“The fundamentals are there for this to be a fairly protracted and sustainable period of pricing,” Mr. Cloutier said, referring to factors including prior years of underpricing and an “industry hole in casualty reserves.”
Gross written premiums slid 4.7% to $2.0185 billion, but this included the nonrenewal of some $800 million of business as Aspen continued to reposition its book.
The favorable pricing and growth in businesses Aspen considers to be its “core continuing lines of business” such as excess casualty, where the company has seen substantial growth, according to Mr. Cloutier, helped offset the nonrenewals, which included some $300 million in crop business, he said.
Aspen’s combined ratio improved to 98.0% in the six months ended June 30, 2021, compared with 110.1% in the six months ended June 30, 2020, as catastrophe losses plummeted to $84.5 million for the six months compared with $231.3 million a year ago.
Last year’s catastrophe losses included $187.3 million of COVID-19 related losses across contingency (event cancellation), business interruption and casualty classes of business, Mr. Cloutier said.
Net investment income dropped 19.1% to $68.7 million for the six months ended June 30, 2021.
Aspen sees growth potential for its Aspen Capital Markets business, which contributed total fee income of $30.5 million during the period.
Mr. Cloutier said that while most capital markets activity has focused on the property sector with retrocessional activity, Aspen has entered into collateralized risk transfer contracts with complex structures and terms for long-tail risks in both its insurance and reinsurance businesses.
Bermuda-based Aspen Insurance Holdings Ltd. posted a net loss of nearly $169 million in the first six months of the year, driven by COVID-19 pandemic-related claims of more than $187 million, Royal Gazette reports. The insurer's net income totaled $18.6 million on excluding pandemic-related claims.