Beazley has raised its outlook as profits more than doubled in the first half of its financial year, with the insurer hailing higher policy rates after years of expensive payouts for natural disasters.
Beazley recorded higher profit before tax of $166.4m, an increase of 189 per cent on the $57.5m it posted in June 2018.
Profits managed to outperform last year’s figure despite a rise in insurance claims from $549.5m to $693.1m this year as gross written premiums rose 12 per cent to $1.48bn.
But the insurer’s combined ratio – which pits costs against revenue – climbed to 100 per cent, compared with 95 per cent last year, as costs rose in some divisions.
Diluted earnings per share soared to almost three times the value of 2018’s 6.5p to 20.1p.
The board increased its interim dividend to 4.1p per share, up from 2018’s 3.9p, which it will pay investors on 29 August.
What Beazley said
Chief executive Andrew Horton said:
“Beazley achieved strong premium growth of 12 per cent in the first half of the year. Claims concentrated largely in our marine and reinsurance divisions drove our combined ratio to 100 per cent, but premium rates have adjusted accordingly and margins in many lines of business now look healthier than they have in some years.
“We expect to achieve double digit growth over the full year, while continuing to reserve prudently.
“Our investment return was 3.3% for the first half of 2019, with nearly all asset classes performing strongly. Investment returns are expected to be lower in the second half of the year.”
Main image: Beazley is set to take office space in Pinnacle, 22 Bishopsgate, a new London skyscraper (Source: Getty)