Lancashire Holdings Q1 profit down, gross written premiums drop

Lancashire Holdings posted a drop in first-quarter pre-tax profit as gross premiums written fell.

In the three months to the end of March, pre-tax profit fell to $26.5m from $51.5m, while gross premiums written declined 5.5% to $230.8m.

Lancashire said an increase in property premiums was offset by reductions in the energy and marine classes.

Property gross premiums written increased by 15.4% compared to the same period in 2015, while energy gross premiums written fell 15.8% and marine premiums were down 26.9%.

Meanwhile, the combined ratio – a key gauge of profitability for insurers – was 72.7% compared with 72% in the same quarter last year.

Chief executive officer Alex Maloney said: “In what remains a very tough underwriting environment, brokers are looking for quality of service and security and are increasingly tiering the insurance market on that basis.

“Whether in Bermuda, London or at Lloyd's, our group platforms are valued for their ability to provide excellent client service in those lines in which we specialise, and we are fortunately seeing opportunities not only to maintain but also to build our participation on some of our core books of business. This has helped insulate our business from some of the chillier blasts faced by the smaller following markets.”

Also on Thursday, Lancashire announced the appointment of Heather McKinlay as chief financial officer of Cathedral Underwriting Limited, the Lloyd’s manging agency within the Lancashire Group.

The company said McKinlay has extensive experience of the Lloyd's and London insurance markets, having served in both executive and non-executive roles.

At 0928 BST, shares were down 3% to 528p.