Everest’s record 2024 investment income offsets adverse US casualty reserve development

Everest has reported a record net investment income of around $2 billion in its full-year 2024 results, with gross written premiums rising to $18.2 billion, up 9.1% year-over-year, driven by growth in its Reinsurance and Insurance segments.

The firm’s full-year 2024 combined ratio stood at 102.3%, with a Reinsurance segment combined ratio of 89.7% and an Insurance segment combined ratio of 130.7%, reflecting strategic actions taken in the latter part of the year to strengthen U.S. casualty reserves.

Everest’s pre-tax catastrophe losses net of recoveries and reinstatement premiums were also up in 2024, reaching $672 million versus $451 million in 2023.

Given this, Everest posted a net income of $1.37 billion for the full year 2024, down from $2.52 billion in 2023.

In Q4 2024 alone, Everest reported a net loss of $593 million and a net operating loss of $780 million, driven primarily by the aforementioned net unfavourable development of prior-year loss reserves in U.S. casualty lines, which stood at $1.5 billion.

This drove a Q4 2024 combined ratio of 135.5%, with a 90.4% combined ratio in its Reinsurance segment, and a 239.2% combined ratio for its Insurance segment.

Meanwhile, Everest’s gross written premiums in Q4 2024 were $4.7 billion, a 7.2% year-over-year increase. Q4 2024 2024 gross written premiums within the firm’s Reinsurance segment grew 12.6% to approximately $3.3 billion.

According to Everest, this was led by a 54.4% increase in Property Catastrophe XOL and 19.9% in Property Pro-Rata, partially offset by a 7.3% decrease in Casualty Pro-Rata, when adjusting for reinstatement premiums.

Pre-tax catastrophe losses in Everest’s Reinsurance segment in Q4 2024 were $125 million, net of estimated recoveries and reinstatement premiums.

This was reportedly driven primarily by $275 million of losses from Hurricane Milton, which were partially offset by a release of $125 million on prior year events, primarily related to Hurricane Ian.

Everest’s total Q4 2024 pre-tax catastrophe losses net of recoveries and reinstatement premiums were $173 million, up from $143 million in Q4 2023.

With all this considered, the firm disclosed a pre-tax underwriting loss of $1.4 billion for Q4 2024, with an underwriting income of $286 million in Reinsurance, and an underwriting loss of $1.3 billion in Insurance.

Jim Williamson, Everest President and CEO commented, “This was a pivotal year for Everest as we took decisive action to fortify our U.S. casualty reserves, solidify our franchise value, and raise the bar across all facets of the Company.

“Our lead market Reinsurance franchise continues to demonstrate its value in the market, as evidenced by another well-executed January 1 renewal. In our Insurance business, the significant transformation of our North American insurance platform is well underway.

“We made meaningful progress improving our portfolio, all while taking aggressive underwriting action in U.S. casualty lines. Our team is energized about the opportunity ahead, and I firmly believe that our actions place Everest on a clear trajectory towards generating attractive returns throughout the cycle.”

Shedding light on the California wildfires, Everest has estimated a pre-tax net catastrophe loss in the range of $350 to $450 million for Q1 2025, net of estimated recoveries and reinstatement premiums. The firm explained that its loss estimate is based on an insured industry loss range of $35 to $45 billion.

This website states: The content on this site is sourced from the internet. If there is any infringement, please contact us and we will handle it promptly.