Swedish Club has reported gross premiums earned of $85.9m for the first half to June 30th 2020, up from $72.8m in the same period last year. Premiums net of reinsurance rose to $66.9m, from $55.1m in H1 2019.
Claims net of reinsurance rose to $58.3m, from $47.6m. The underwriting result deteriorated to a loss of $3.3m, from $2.2m in H1 2019. Free reserves rose to $225.0m from $220.7m on June 30th 2019. The combined ratio improved to 107%, from 108% in the same period last year.
The Club said that it had “added attractive business and adjusted its premiums to better align with exposures”. The trend in attritional claims was termed “quite positive”, although “a few sizeable claims in the current year and run-off brought the combined ratio to 107% for the first half.”
The Club noted that the first six months of this year had seen “unprecedented drops and, subsequently, recuperations of equity prices”. By June 30th the investment portfolio had delivered a 0.5% return, down from 6.3% in H1 2019. Swedish Club’s investment portfolio is distributed approximately 80% interest-bearing assets and 20% equity holdings, amounting to $371m, up from $356m on June 30th 2019. This was due to “positive results and the timing of servicing previously reserved claims”.
Managing director Lars Rhodin said that the Club had “limited involvement” with the cruise industry and that the widespread shutdown of the industry since March had been of no material impact on the profit and loss statement. He said that, while Swedish Club did not see an effect from Covid-19 in the long term, the pandemic would affect both short- and medium-term business development projections.
He concluded that “these exceptional circumstances have given us all time to consider – to reflect on what we do and what we are able to deliver. The half-year results have demonstrated that we will come out of this situation as a more efficient organization”.
The Club said that its underwriting performance was “within the expected range for this part of the insurance cycle”, adding that “a strengthening of market pricing will most likely be a positive contributor to improved balance going forward”.
The Club said that it had been using its Trade Enabling Loss Prevention programme (TELP) to guide vessels into ports around the world, helping members overcome the difficulties they were facing in operating ships during the Covid-19 outbreak.