Amlin boosted by rate improvements and limited catastrophe losses

Insurance and reinsurance firm Amlin has said that the underwriting environment for the period from the start of July has been 'encouraging', with rate improvements and limited catastrophe loss activity.

The group said rate improvements have been achieved for more than 80% of the portfolio during the ten months to the end of October and overall, renewal rate increases have averaged 3.8% in the period.

The group's gross written premium for the ten month period was up 11.1% at £2,278.8m (October 31st 2011: £2,051.9m). The average renewal rate increase was 3.8% (October 31st 2011: 0.9%) with a renewal retention ratio of 84.5% (October 31st 2011: 82.1%).

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Hurricane Sandy, which hit the US in late October, caused material damage to the US east coast, but the actual impact is still to be determined. The company was keen to stress that the fact it's had a favourable first nine months means it is well placed to absorb claims.

Assessing its current positon the firm said: "Amlin remains in a healthy financial position and is well capitalised to support growth as conditions improve and opportunities materialise. The core profitability of our London and Bermuda business is strong and profitability continues to improve in our UK business. Additionally, there is increasing evidence that the action taken at ACI is having a positive effect. In a low interest rate environment, our profit focused underwriting strategy should encourage the business to prosper."

The North American catastrophe business achieved an average renewal rate increase of 8.1%, whilst the international reinsurance account achieved an average increase of 15.0%. Rate increases were more marked in loss affected territories, such as Australasia and Japan.

In the quarter ended September 30th, following the normal quarterly review of claims reserves, £16.4m was released from reserves, bringing cumulative releases for the nine months to September 30th to £69.4m (September 30th: £71.2m).

The share price rose 2.26% to 375.30p by 09:52.

NR