Omega GWP down 7% as it exits Bermuda third-party business

Lloyd’s insurer Omega’s gross written premium fell 7% in the first quarter of 2012 to $120.6m (£75m) (Q1 2011: $129.4m) as a result of the non-renewal of its Bermuda third-party reinsurance business.

The Bermuda third-party business had accounted for $19.4m of premium in the first quarter of 2011. The company announced last year it would stop writing the business.

Excluding the Bermuda exit, gross written premium in Omega’s continuing business increased. Premium derived from the company’s Lloyd’s syndicate, 958, was up 8% to $106.6m (Q1 2011: $98.5m), and Omega US’s gross written premium increased 16% to $13.3m (Q1 2011: $11.5m).

Omega also increased its participation on Syndicate 958 to 61% of the business for the 2012 year of account from 51% in 2011.

“It is pleasing to report that gross written premium in our ongoing operating segments is up 9% on last year and that the reserves set for catastrophe losses at the year end have not changed,” Omega chief executive Richard Pexton said in a statement. “Rates in both US SME commercial property and US catastrophe accounts, our two largest classes of business, continue to improve and we envisage they will rise incrementally throughout the remainder of the year.”

Fellow Lloyd’s insurer Canopius is in the process of buying Omega for 67p a share in cash. Omega’s board has recommended Canopius’s offer to its shareholders.

“The [Canopius] acquisition represents the first all-cash proposal presented to the Omega board that would allow all shareholders to exit their shareholding in the company.”