Amlin reports ‘more encouraging’ Q1 as GWP rises 10.5%

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However, GWP cuts continue at Amlin Corporate Insurance

Amlin said it enjoyed a “more encouraging” trading environment in the first quarter of 2012, thanks to rate rises and lower catastrophe activity.

The Lloyd’s insurer said that more than 75% of its portfolio achieved rate rises in the period to 30 April. It achieved average rate increases of 4.3% across its book (see table below).

Catastrophe prices increased “strongly”, with margins at more close to peak levels.

On insurance, Amlin said it continued to see improvement in its UK commercial business, particularly UK motor.

Rate increases for US commercial property have continued to improve, building on the modest increases experienced at 1 January, while US liability business has begun to show signs of improvement.

Amlin also benefited from £17.6m of reserve releases in the quarter.

Amlin’s gross written premiums increased 10.5% to £1.44bn in the first four months of the year (Q1 2011: £1.30bn), reflecting growth in all areas except its Amlin Corporate Insurance (ACI) business.

ACI’s gross written premium dropped 17% to £368.5m (Q1 2011: £442.6m) as a result of further “portfolio adjustments” in its marine business at the start of 2012.

“We believe that the major changes to ACI’s marine portfolio are very largely complete and that, with increased profit focus and direction, it is now in a position to grow income when market conditions in the Benelux improve.” Amlin said in a statement.

Amlin is in the process of transferring ACI onto a new system, which it expects to complete by the end of May.

“Amlin has had a good start to 2012 and the trading environment continues to improve, with more than 75% of our portfolio achieving rate increases in the period to 30 April,” Amlin chief executive Charles Philipps said. “Amlin is in a sound financial position and well capitalised to support profitable growth into more favourable market conditions.

“The transition of ACI onto Amlin’s systems will be a significant step forward, which should further improve operating performance in the medium term. We remain well positioned to return to a good level of profitability during 2012.”