Greenlight mulls syndicate move, highlights industry resilience
The reinsurance industry was "severely tested" by last year's natural catastrophes in the Americas, Cayman Islands-based reinsurer Greenlight said.
Greenlight cited the hurricanes that struck the Caribbean the US and the earthquakes that hit Mexico, as well as the California wildfires.
"The industry was severely tested by the scale and unusual nature of these events that combined produced more than US$100bn in industry losses," CEO Simon Burton said during a results call. "Our share of this industry loss was within expectations and I continue to be pleased with the resilience of our business to cat events."
UK insurance and reinsurer broker Aon made similar comments last month.
ALSO READ: Caribbean Insurance Report
Greenlight's estimated Q4 net natural catastrophe losses were US$4.7mn from the California wildfires, while the Q3 net loss estimate was US$37.9mn from the hurricanes and Mexican earthquakes.
Greenlight posted an overall US$45.0mn loss for 2017 compared with net income of US$44.9mn in 2016.
Gross written premiums were US$693mn, up 29.2%.
NEW BUSINESS LINES
The company has started targeting specialty business classes and has already entered marine, energy and space.
"We have expanded the portfolio pipeline and our appetite for diversifying classes," said Burton, who added that setting up a Lloyd's syndicate was being mulled.
"It's [setting up a syndicate] been discussed. It's one of a long-list of strategic directions that we may consider in the future."
PRICING
"As you would expect, rates in catastrophe-exposed classes improved across the board but increases in excess of 10% were isolated," he said.
"We were not surprised by the muted rated changes we saw at January 1 as it seemed clear that the supply of capital could not support the pricing dislocation that was predicted by some," Burton said. "For too long our industry has relied on post-loss price increases to offset underprice risk. It's been delusional behavior for some time and I hope that's the end of it."
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