Amlin slumps to first half loss

City A.M. Reporter
Lloyd's of London insurer Amlin crashed to a £192.3m pre-tax loss in the first half of 2011 after absorbing a surge in claims from the Japanese earthquake and other natural disasters.

Amlin had earlier this month already flagged up a loss of about £180m, some £65m more than analysts were expecting, because of a bigger-than-expected hit from the earthquake and a surprise jump in claims at ACI, its European commercial insurance unit.

Analysts have said the August 2 profit warning dented Amlin's reputation for carefully controlling its exposure to major catastrophes.

The company, which paid 350m euros to buy ACI from Belgo-Dutch bank Fortis in 2009, has said it is taking steps to improve the unit's performance.

Amlin joins peers including Hiscox, Beazley and Catlin in reporting steep first-half losses, weighed down by an unprecedented run of catastrophes including floods in Australia, earthquakes in Japan and New Zealand, and tornadoes in the U.S.

This year has already displaced 2005 as the costliest on record for natural disasters, with economic losses from catastrophes in the first six months alone totalling $265 billion, according to Munich Re, the world's No. 1 reinsurer.

Amlin maintained its interim dividend at 7.2 pence per share and said it remained confident over its long-term prospects.

"While our results are disappointing, the core underwriting businesses in London and Bermuda are well placed to take advantage of an improving rating environment, particularly in catastrophe lines," Chief Executive Charles Philipps said in a statement.