IRB (Re) sees net income increase in Q2 as CoR improves

Brazilian reinsurer IRB (Re) has announced financial results for the second quarter of 2024, reporting a net income of R$ 65 million (USD 12m), an underwriting profit of R$ 34 million (USD 6.2m) and an improved combined ratio of 106% from last year’s 107.5%.

Compared to the second quarter of 2023, net income increased from R$ 20 million (USD 3.7m), while underwriting profit went down 4.7%, from R$ 35.4 million (USD 6.5m).

The reinsurer’s total written premiums in Q2 2024 were R$1,434 million (USD 262m), compared to the R$ 1,394.4 million (USD 255m) reported in the same period the year prior.

For its Brazil business, IRB (Re) reported R$ 1,177.7 million (USD 215m) written premiums, an 18% increase from Q2 2023’s R$ 994.3 million (USD 182m), with the Property and Life segments positively impacting the volume of written premiums.

According to the reinsurer, the higher volume of written premiums in Brazil is in line with the company’s strategy of increasing exposure in the country, where IRB (Re) is the market leader and has competitive advantage.

Written premiums Abroad totalled R$ 256.2 million (USD 47m), down 35.9% from the R$ 400 million (USD 73m) seen in 2023 second quarter.

Total earned premiums were up 1.8% to R$ 1,039.4 million (USD 190m) in Q2 2024, from R$ 1,021.0 million (USD 187m) in Q2 2023. According to the company, the reduction in the earned premium volume is in line with the 10% decrease in retained premiums.

IRB (Re)’s Brazil business reported an underwriting profit of R$ 37.7 million (USD 6.9m), which was an improvement from the R$ 18.1 million (USD 3.3m) reported in Q2 2024.

On the other hand, underwriting Abroad went down, going from R$ 17.3 million (USD 3.2m) in Q2 2023 to a loss of R$ 4.0 million (-USD 700,000) in Q2 2024.

IRB (Re) also reported its financial results for the first half of 2024, where its net income reached R$ 144 million (USD 26.3m), a figure that represented a five-fold increase over the one reported for H1 2023 of R$ 28.6 million (USD 5.2m).

Underwriting profit for the period was R$ 156 million (USD 29m), which represents a growth of R$ 117 million (USD 21.4m) as compared to the first half of the previous year.

Loss ratio stood at 65% for the 2Q24 and 62% for the 1H24. YoY, both the ratios for the three and six-month periods improved, and stood at 8.6 p.p. and 13.8 p.p., respectively. The combined ratio for H1 2024 was 102.1% compared with H1 2023’s 108.7%.

In the first half of the year, written premiums amounted to R$ 2,874 million (USD 525m), down by 3.5% from the 1H23, affected by the agriculture segment.

H1 2024, earned premiums amounted to R$ 1,948.6 million (USD 356m), down by 12.6% YoY. The reduction in the volume of earned premiums for the year is mainly explained by lower retained premiums.

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