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Beazley PLC published its trading statement for the six months ended 30 June 2023. During this period, gross premiums written increased by 13% to $2,894.1 million, and net premiums written rose by 28% to $2,290.2 million. The company reported net income from investments of $143.8 million, representing a 1.5% return, and premium rates on renewal business increased by 5%.
| Date | 27 Jul 2023 |
| Time | 07:00:12 |
| Category | Trading updates |
| ID | 3315H |
Beazley delivers strong growth in first half of the year
London, 27 July 2023
Beazley plc trading statement for the six months ended 30 June 2023
Overview (on an IFRS 4 basis)
· Gross premiums written increased by 13% to $2,894.1m (H1 2022: $2,554.9m)
· Net premiums written increased 28% to $2,290.2m (H1 2022: $1,795.9m)
· Premium rates on renewal business increased by 5% (H1 2022: 18%)
· Net income from investments of $143.8m or 1.5% as at 30 June 2023 (H1 2022: loss of $193.0m)
· Growth guidance of mid teens gross premiums written and mid 20s net premiums written remains for 2023 full year
Adrian Cox, Chief Executive Officer, said:
"The excellent conditions in the property market persisted into the second quarter and we continued to take advantage of those, delivering a strong performance on growth for the group in the first half of 2023.
With premium written in line with our expectations, we are confident of delivering our growth guidance for the year."
|
|
30 June 2023 |
30 June 2022 |
% increase/ (decrease) |
|
Gross premiums written ($m) |
2,894.1 |
2,554.9 |
13% |
|
|
|
|
|
|
Net premiums written ($m) |
2,290.2 |
1,795.9 |
28% |
|
|
|
|
|
|
Investments and cash ($m) |
9,644.1 |
7,938.6 |
21% |
|
|
|
|
|
|
Year to date investment return |
1.5% |
(2.5%) |
|
|
|
|
|
|
|
Rate increase |
5 |
18 |
|
Premiums
Our performance to the end of June 2023 by business division is:
|
|
Gross premiums written
30 June 2023
|
Gross premiums written
30 June 2022
|
% increase/ (decrease) |
Year to date Rate change |
|
|
$m |
$m |
% |
% |
|
|
|
|
|
|
|
Cyber Risks |
539.7 |
472.7 |
14 |
(3) |
|
Digital |
110.4 |
111.1 |
(1) |
(1) |
|
MAP Risks |
517.4 |
547.2 |
(5) |
6 |
|
Property Risks |
791.6 |
478.0 |
66 |
22 |
|
Specialty Risks |
935.0 |
945.9 |
(1) |
(1) |
|
OVERALL |
2,894.1 |
2,554.9 |
13 |
5 |
Cyber Risks has performed well year to date with 14% growth in the first half of 2023, despite a slight reduction in rates. The headwinds experienced in the first half of the year relating to war wordings are beginning to recede, although the market remains competitive. We are confident in the long term growth prospects for cyber, particularly in Europe which provides a significant opportunity and continued to perform well in the first half of the year.
MAP Risks has performed in line with expectations. As previously highlighted, gross premium has reduced due to the portfolio underwriting business now being written by syndicate 5623 which is backed predominantly by third party capital. This has the effect of reducing year on year gross premium growth in the division. Net premium growth is not materially affected.
The growth in Property Risks is significant at 66% for the first half of the year.
We continue to take advantage of the conditions in the property market with property reinsurance growing as expected and property insurance slightly better than planned for. The hardening of the reinsurance market has driven rate increases in the primary market more quickly than anticipated.
In Specialty Risks the very challenging conditions continue in D&O. We remain focused on areas which are less exposed to social inflation and work to diversify the mix of business within the division.
Investments
Our portfolio allocation was as follows:
|
|
30 June 2023 |
30 June 2022 |
||
|
|
Assets |
Allocation |
Assets |
Allocation |
|
|
|
|
|
|
|
Cash and cash equivalents |
964.3 |
10.0 |
629.0 |
7.9 |
|
Fixed and floating rate debt securities |
|
|
|
|
|
- Government, quasi-government and supranational |
4,724.1 |
49.0 |
4,344.2 |
54.8 |
|
- Corporate bonds |
|
|
|
|
|
- Investment grade |
2,500.9 |
25.9 |
1,811.2 |
22.8 |
|
- High yield |
362.7 |
3.8 |
304.9 |
3.8 |
|
Syndicate loans |
33.2 |
0.3 |
32.2 |
0.4 |
|
Derivative financial assets |
6.8 |
0.1 |
20.0 |
0.3 |
|
Core portfolio |
8,592.0 |
89.1 |
7,141.5 |
90.0 |
|
Equity funds |
251.2 |
2.6 |
63.7 |
0.8 |
|
Hedge funds |
564.5 |
5.8 |
482.6 |
6.0 |
|
Illiquid credit assets |
236.4 |
2.5 |
250.8 |
3.2 |
|
Capital growth assets |
1,052.1 |
10.9 |
797.1 |
10.0 |
|
Total |
9,644.1 |
100.0 |
7,938.6 |
100.0 |
Our investments returned $143.8m, or 1.5% in the first half of 2023. Yields on our fixed income investments are higher than for many years and this has supported returns in the period. However, risk-free yields remain volatile and have continued to rise in recent months, reducing fixed income returns below initial expectations.
Our fixed income portfolio yield is 5.3% at 30 June.
Note IFRS 17 restatements for HY2022 and FY2022 will be released on 31 July 2023
Conference call
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Sarah Booth
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Media
Sam Whiteley
+44 (0) 207 6747484
Note to editors:
Beazley plc (BEZ.L), is the parent company of specialist insurance businesses with operations in Europe, North America, Latin America and Asia. Beazley manages seven Lloyd's syndicates and, in 2022, underwrote gross premiums worldwide of $5,268.7 million. All Lloyd's syndicates are rated A by A.M. Best.
Beazley's underwriters in the United States focus on writing a range of specialist insurance products. In the admitted market, coverage is provided by Beazley Insurance Company, Inc., an A.M. Best A rated carrier licensed in all 50 states. In the surplus lines market, coverage is provided by the Beazley syndicates at Lloyd's.
Beazley's European insurance company, Beazley Insurance dac, is regulated by the Central Bank of Ireland and is A rated by A.M. Best and A+ by Fitch.
Beazley is a market leader in many of its chosen lines, which include professional indemnity, cyber liability, property, marine, reinsurance, accident and life, and political risks and contingency business.
For more information please go to: www.beazley.com