Norway-based marine insurer Skuld has reported a loss of $10m for the first nine months of policy year 2020/21, a slight improvement on the loss of $12m recorded during the same period in 2019/2020.
The nine-month technical result was minus $46.2m, with a combined ratio of 118%. This compared with 116% for the same period last year.
Skuld said the loss had been driven by increased and new pool claims from other members of the International Group (IG), and some of Skuld’s own large claims within the club retention.
Skuld noted that mutual P&I members continued to benefit from the insurer’s commercial operations and diversified investment portfolios.
Net investment income for this period was $38m, ” primarily driven by the contribution from global equity markets in the past month”. There was a positive investment return of 5.4%. “Although the market has been impacted by the Covid-19 pandemic this year, the recent news regarding vaccinations has set the stage for an improving market condition and a more promising shipping environment”, said Skuld.
CEO Ståle Hansen said that “the volume of IG pool claims is at its highest in recent years, and our share of these claims affected the result negatively by $36.5m (2019: -$20.2m).”
Own claims for own account rose to -$214.0m, from -$206.6m in the same period last year.
Hansen said that mutual rates had not been sustainable for some time, while noting that Skuld was “working to bring the portfolio back into balance through improved rates”. Hansen said that “the good news is that our strategy of diversification is standing firm. Notably, in times like these our mutual P&I members benefit from additional profitability coming from our commercial operations”.
The commercial lines division booked a combined ratio of 93%.
Reduced uncertainty around the US political scene had also “set the stage for a more promising shipping environment, especially into those sectors hit hardest by the pandemic”, said Hansen.
|Consolidated income statement 20/11/2020||2020 (9 months)||2019 (9 months)|
|Premiums and calls||289.6||283.2|
|Premiums for own account||256.8||245.8|
|Own claims for own account||-214.0||-206.6|
|Claims incurred for own account||-250.5||-226.8|
|Net operating expenses||-52.5||-65.6|
|Balance carried to non-technical account||-46.2||-46.5|
|Balance from technical account||-46.2||-46.5|
|Net investment income||38.0||36.1|
|Balance carried to members’ funds||-10.0||-12.1|