Everest Re Group reports second quarter increase in net income

Everest Re Group, Ltd. last week reported second quarter 2014 net income of US$290.2 million and net income of US$584.1 million for the six months ended June 30, 2014.

The Q2 net income was up from US$275.6 million for the same quarter of 2013, and down from the US$660.0 million for the first six months of 2013, notes a statement from Everest Re Group.

The Bermuda holding company operates through subsidiaries that provide reinsurance to insurers in numerous markets, including Canada.

“Everest continues to generate strong earnings, despite a challenging marketplace,” Dominic J. Addesso, president and chief executive officer of Everest Re Group, says in the statement.

“We are seeing select market opportunities, which is driving top-line growth and producing excellent underwriting margins and double-digit returns on equity. This is driving growth in shareholder value with book value per share, adjusted for dividends, up over 10% through the first six months of the year,” Addesso adds.

Everest Re’s gross written premiums increased 12% to US$1.4 billion compared to the second quarter of 2013, the statement notes. Worldwide, reinsurance premiums were up 16% and insurance premiums were flat, quarter over quarter.

Catastrophe losses amounted to US$45.0 million in Q2 of 2014, arising from the Chile earthquake during the quarter and late reported losses from severe snowstorms in Japan during February, Everest Re reports. “The net impact of these losses, after reinstatement premiums, taxes, and non-controlling interest, was US$32.1 million,” the company adds.

“Growth opportunities in U.S. property and specialty lines continue to drive the growth in the reinsurance book,” notes the statement.

Other results for the second quarter of 2014 include the following:

• 17% net income return on equity;
• net investment income of US$131.2 million;
• after-tax operating income, excluding realized capital gains and losses, of US$250.8 million compared to US$253.2 million in Q2 of 2013; and
• a combined ratio of 84.7% compared to 87.6% in Q2 of 2013.

“Excluding catastrophe losses, reinstatement premiums, and prior period loss development, the current quarter attritional combined ratio was 81.4% compared to 80.2% in the same period last year,” the Everest Re statement adds.

As for the six months ended June 30, 2014, after-tax operating income, excluding realized capital gains and losses, was US$531.7 million compared to US$554.2 million for the same period in 2013.