Skuld’s Annual Report for the period 21.02.22 to 20.02.23, its first integrated annual report, has revealed a gain of $32m for the year ended February 20th 2023, with a positive technical result of $15m. The combined ratio improved to 97%.
“A strong 2022/23 renewal with portfolio growth in both mutual and commercial lines of business contributed to a growth in gross earned premiums and calls of $54m”, said Skuld, noting that this was partly offset by an increase in reinsurance premiums of $27m. Net premium rose year on year to $392m, from $365mi in 2021/22.
Net claims incurred fell to $287m, from $318m in 2021/22. “In general, 2022/23 was a benign claims year with a reduction of large claims compared to historical average”, said Skuld, noting that Covid-19 related claims were significantly reduced. This however was partly offset by a couple of larger Hull War claims in connection with the war in Ukraine.
Claims costs were significantly influenced by pool claims from other members of the International Group of P&I Clubs mainly driven by development on earlier years. Skuld reported no new pool claims this year.
Skuld said that “after a period of non-sustainable rates in the mutual book of business, there was a gradual improvement of technical result during 2022/23”.
It was “a challenging year for the investment portfolio”. This was due to rising yields, a strengthening of the dollar and weakening equity markets.
With a positive contribution from the sale of Asta, net investment income ended at $4.7m, up from $2m last year and representing a net investment return on financial assets of 0.3%.
Taxes amounted to an income of $14m in 2022/23, mainly driven by currency effects of tax balances in Norwegian Krone and negative results in the Norwegian Association. Contingency reserves now stand at $445m.
KPIs
| $m | 2022/23 | 2021/22 | 2020/21 | 2019/20 | 2018/19 |
| TECHNICAL ACCOUNT | |||||
| Premiums and calls | 473.3 | 419.5 | 390.8 | 390.8 | 401.6 |
| Reinsurance premiums | -81.3 | -54.1 | -44.7 | -47.4 | -56.1 |
| Premiums for own account | 392.0 | 365.4 | 346.1 | 343.4 | 345.6 |
| Pool claims | -29.1 | -31.2 | -41.1 | -24.5 | -32.1 |
| Own claims for own account | -258.1 | -286.7 | -260.0 | -264.3 | -212.4 |
| Claims incurred for own account | -287.2 | -317.7 | -301.2 | -288.8 | -244.6 |
| Acquisition costs | -69.5 | -59.9 | -57.7 | -70.5 | -74.5 |
| Administrative expenses | -20.2 | -18.3 | -17.4 | -19.3 | -18.5 |
| Net operating expenses | -89.7 | -78.0 | -75.1 | -89.8 | -92.9 |
| Balance carried to non-technical account | 15.0 | -30.3 | -30.1 | -35.2 | 8.0 |
| NON-TECHNICAL ACCOUNT | |||||
| Balance from technical account | 15.0 | -30.3 | -30.1 | -35.2 | 8.0 |
| Net investment income | 4.7 | 2.1 | 62.9 | 55.1 | 0.9 |
| Taxes | 13.8 | 13.2 | -6.3 | 5.0 | -0.5 |
| Other result components | -1.6 | 0.3 | -1.9 | 0.6 | 2.2 |
| Balance carried to contingency reserve | 31.8 | -14.7 | 24.6 | 25.5 | 10.7 |
Claims opened 11,285
Notified casualties 42
Mutual premium growth of 12%, commercial premium growth of 13%
Net claims incurred
| $000s | 2022/23 | 2021/22 |
| Gross claims paid | ||
| Own claims | 321,275 | 274,146 |
| Group pooling arrangements | 31,317 | 25,044 |
| Gross claims paid | 352,592 | 299,191 |
| Reinsurance recoveries | ||
| Group pooling arrangements | -55,587 | -33,325 |
| Market underwriters | -42,457 | -29,790 |
| Reinsurance recoveries | -98,044 | -63,115 |
| Net claims paid | 254,548 | 236,076 |
| Change in provision for gross claims | ||
| Provision opening balance | 917,595 | 690,573 |
| Provision closing balance | 1,107,176 | 917,595 |
| Change in currency valuation at year end | 22,248 | 17,195 |
| Gross change in estimated outstanding claims | 211,828 | 244,218 |
Less movements in provision for reinsurers’ share
| Provision opening balance | -322,420 | -160,636 |
| Provision closing balance | -499,184 | -322,420 |
| Change in currency valuation at year end | -2,372 | -858 |
| Reinsurers’ share | -179,137 | -162,642 |
| Change in provision for future claims | ||
| Net change in claims provision | 32,692 | 81,575 |
| Claims incurred for own account | 287,240 | 317,651 |
Ståle Hansen, Skuld president and CEO, said that Skuld was “delighted to issue our first integrated annual report, combining a highly successful financial result while proudly presenting significant achievements in our work within ESG and sustainability.”
https://www.skuld.com/about/-/press-releases/2023/skuld-delivers-solid-result-in-202223/