Syndicate Results 2022 #5 Tokio Marine Combined Syndicate 510

The Lloyd’s syndicates have now published their results for 2022 and, in some cases, added detail and an outlook for 2023. Some have stuck to the bare bones. As in the previous few years, IMN is summarizing the results from all syndicates that have a notable marine interest, if they have provided some information on the marine side.

Tokio Marine Kiln Syndicates Limited (TMKS) is the managing agent of Tokio Marine Combined Syndicate 510, Tokio Marine Kiln Syndicate 1880, Tokio Marine Kiln Catastrophe Syndicate 557 and Tokio Marine Kiln Life Syndicate 308.

TMKS is a wholly-owned subsidiary of Tokio Marine Kiln Group Limited (TMKGL). TMKGL and its subsidiaries are referred to as Tokio Marine Kiln (TMK). TMKGL’s ultimate parent is Tokio Marine Holdings Inc Japan (Tokio Marine).

On October 7th 2022 the Lloyd’s Capacity Transfer Panel (CTP) approved an application to merge Syndicate 557 into the 2023 year of account of Syndicate 510, with members of the 2022 year of account of Syndicate 557 being allocated capacity on the 2023 year of account of Syndicate 510. It is anticipated that the last trading year of account of Syndicate 557 (the 2022 year of account) will reinsure-to-close into the 2023 year of account of Syndicate 510 at 36 months.

Active Underwriter     M A Mortlock

Chief Executive Officer        B T Irick

KPI £m 2022 2021
Gross written premium 1,576.1 1,365.1
Net earned premium 1,009.7 903.6
Profit/(loss) for the financial year 56.8 82.3
Investment return (41.1) (4.2)
Claims ratio 48.9% 46.4%
Combined ratio 90.6%% 88.9%

Gross written premium for the year of £1,576.1m (2021: £1,365.1m) generated a profit of £56.8m (2021: £82.3m) and a combined ratio of 90.6% (2021: 88.9%).

At constant rates of exchange, gross written premium increased by 6.3% compared to prior year, primarily driven by growth in the Property & Motor, Specialty, Liability and Marine & Energy divisions.

The net claims ratio of 48.9% was higher than prior year (46.4%) driven by catastrophe losses. In 2022 the Syndicate was impacted by provisions for potential exposures arising from the Ukraine War, in addition to weather related losses from Hurricane Ian, Winter Storm Elliot and the US Tornadoes.

The Syndicate benefited from benign attritional claims experience, which resulted in a claims ratio, excluding catastrophe losses and reserve releases on closed years, of 38.6% (2021: 38.9%). The strong attritional claims performance was seen across almost all divisions, most notably within Specialty, Aviation and Property & Motor. This in part followed remediation action undertaken and a rebalancing of the underwriting portfolio, the Syndicate said in its report.

Prior year reserve releases on the 2019 and prior years of account contributed £95.8m to underwriting profit (2021: £47.2m), with releases predominantly falling on the Property & Motor, Specialty and Marine & Energy divisions.

£m GWP GWP Underwriting Result Undewriting Result
Division 2022 2021 2022 2021
Marine & Energy 73.3 54.6 8.3 12.7
Total 1576.1 1,365.1 95.4 100.7

The Marine & Energy division provides general cargo, marine excess of loss, fine art, and specie cover, as well as coverage for offshore deep-water exploration, construction, and production exposures.

The division reported gross written premium of £73.3m (2021: £54.6m) and an underwriting profit of £8.3m (2021: £12.7m). Growth was achieved in the Marine excess of loss class, which took advantage of hardening market conditions following the restructuring and repricing of composite reinsurance programmes. The Syndicate noted that the division had also established a lead market for the Fine Art portfolio, which remains an area of strategic focus.

The underwriting profit of £8.3m was driven by prior year reserve releases following continued benign claims experience, partially offset by provisions for potential exposures arising from the Ukraine War.

2023 outlook

Across the Property portfolio, the rating environment remained positive. This was reflected in the January 1st renewals, particularly on US open market and binding authority risks, which have been heavily impacted by recent catastrophe activity. Within Aviation the rating environment gained momentum towards the end of 2022, particularly within Aviation War business, and is expected to continue into 2023.

Segmental report

2022 £’000s GPW GPE GCI GOE ReinsBal Result
MAT 135,691 127,797 (162,661) (57,512) 50,892 (41,484)
Total 1,576,119 1,494,158 (807,675) (535,985) (55,098) 95,400
2021 £’000s GPW GPE GCI GOE ReinsBal Result
MAT 122,961 115,724 (53,397) (50,155) 9,036 21,208
Total 1,365,131 1,393,663 (690,927) (506,954) (95,114) 100,668
Active Underwriter Emoluments £’000 2022 2021
Emoluments 357 390