Beazley weathers catastrophe storm

22nd Jul 2011 09:19

Beazley, the insurance company, incurred a pre-tax loss of $24.2m (£14.8m) in the first six months of 2011, during a tumultuous period that saw a series of catastrophes in Australia, New Zealand, Japan and the US.In its interim management statement, Beazley confirms its $154m estimate of net costs of the earthquake in New Zealand and the flooding in Australia. Its exposure to the exceptional tornadoes in the US is estimated to be $29m.The firm claims long term profitability is at 6.4% but gross written premiums are seen down 1.7% at $924.8m. Interestingly, investment income has risen significantly to $22.5m from $8.5m in 2010.Andrew Horton, Chief Executive Officer, said:"Further large losses in the second half would likely cause significant capital erosion and sharply rising premium rates across the industry. Beazley is well prepared for such a scenario, in which our underwriting skills, operating platform and financial flexibility should position the group favourably."Beazley's share price was up 3.3% on today's announcement.BS