Beazley growth hit by currency

Beazley reported increased for the first six month of 2009 with profits hit by currency changes.

Financial Highlights (2008 in brackets)

• Gross written premiums £596.4m (£407.3m) up 46%
• Net written premiums £341.5m (£292.3m) up 17%
• Net earned premiums £358.7m (£312.2m) up 15%
• Profit before tax £20.1m (£45.0m) down 55%
• Profit before tax and foreign exchange adjustments on non-monetary items £69.9m (£46.0m)
• Gross written premiums on a constant currency basis up 23.8%
• Rates on renewal business increased by 5%
• Combined ratio of 90% (89%)
• Annualised investment return of 2.9% (1.7%)

Operational Highlights

• Raised additional equity capital of £150m - completed in April 2009 and deployed to support additional underwriting and acquisition
• Acquisition of First State, a US underwriting manager specialising in commercial property insurance, completed on 1st April 2009 for a cash consideration of $35.4m.
• Redomiciliation of the group to the Republic of Ireland completed in July 2009.
• New investment team in place and credit portfolio de-risking completed.
• During 2009, three new board members joined the group: Martin Bride as group finance director; and Padraic O'Connor and Vincent Sheridan, both as non-executive directors.

Andrew Horton, CEO, said: “Our businesses performed well in the first half of the year against a backdrop of continued turbulence in both insurance and investment markets.

“Across our portfolio, we saw a 5% increase in renewal premium rates, driven by significant rate rises for classes of business - such as energy, large scale commercial property, and reinsurance - that were affected by last year's severe hurricane season.

“Rates for casualty business have been, as we anticipated, slower to move. But we expect the depressed investment returns experienced by the market as a whole to put upward pressure on casualty rates before the end of the year.”

Underwriting discipline at Lloyd’s

“In the medium term we expect market conditions to further enhance the already strong reputation for financial stability and underwriting discipline that Lloyd's enjoys among insureds and brokers.

“The way risk is spread through the syndicated structure of the Lloyd's market is also attractive to insureds at a time of growing concern about counterparty risk.”