Brit Insurance has announced that it swung to a pre-tax loss of $232m (£168m) in the full-year ended 31 December 2020, down from a profit of $179.9m (£131m) reported the year before.
In the same period, the group made a loss on ordinary activities, before the impact of FX and tax, of $233.7m (£170m), down from a profit of $183m (£133m) in 2019.
The group said it has “stood tall” with respect to valid Covid-19 claims, noting that the financial impact on Brit has been “significant”, with claims of $270.7m (£196m) paid out in relation to the pandemic.
It added that the pandemic has predominantly impacted its Contingency (event cancellation) and Casualty Treaty books. These losses have driven an increase of 15.9pps in its combined ratio, bringing the overall combined ratio to 112.6%.
Despite the backdrop of the pandemic, however, the group said there were a “number of positives” in the period.
It achieved risk adjusted rate increases of 10.6%, for example, with almost all classes contributing to the increase, giving a total overall increase since 1 January 2018 of 20.2%.
It also continued to grow its gross written premiums to $2.4bn (£1.74bn), a 5.7% against the prior year. In addition, it delivered an attritional claims ratio of 52.6%, an improvement of 2.4pps, reflecting underwriting discipline, “rigorous” risk selection, and rate increases.
Matthew Wilson, group CEO, said: “Our products are designed to support businesses and individuals in such difficult times and we have focussed on responding to claims as they have been notified.
“We have stood tall with respect to valid Covid-19 claims and the financial impact on Brit has been significant. Furthermore, 2020 was also a very active year for catastrophe events, being the fifth-costliest on record.”
He added: “Looking ahead to 2021, against the challenging backdrop there are a number of indicators to give us cause for optimism, including rate increases, the withdrawal of capacity in the market from certain classes and our improving attritional claims ratio.
“In this environment, our clear strategy of embracing data driven underwriting discipline, rigorous risk selection and planned targeted growth for 2021, coupled with innovative capital management solutions and continued investment in distribution, positions us well to respond to the opportunities and challenges ahead.”