Ambac posts improved 96.5% CoR for Q4’24

Ambac Financial Group, Inc., a financial services holding company specialising in insurance and reinsurance, reported strong growth in its fourth-quarter 2024 results.

Ambac’s underwriting performance for the fourth quarter of 2024 saw continued progress, particularly in its Specialty P&C insurance and Insurance Distribution segments.

The company reported $59.99 million in gross written premiums in Q4, reflecting a 34% decrease compared to Q4 2023. However, for the full year, gross written premiums increased by 40%, reaching $382.77 million, compared to $273.29 million in 2023.

Ambac’s combined ratio for Q4 2024 showed significant improvement, reflecting a reduction in underwriting losses. The ratio decreased by 380 basis points, reaching 96.5% compared to 100.3% in Q4 2023.

In terms of underwriting income, the company saw a decrease in loss and loss adjustment expenses, which amounted to $9.83 million in Q4 2024, down from $16.81 million in Q4 2023. This was a key factor in driving the overall improvement in the combined ratio, despite experiencing some catastrophe losses during the period.

Additionally, Ambac’s total policy acquisition costs and commission expenses increased to $7.85 million and $13.67 million, respectively, in Q4 2024.

However, the improvement in underwriting performance led to a net income from continuing operations of $2 million for the Specialty P&C insurance segment for the quarter, compared to $1 million in Q4 2023.

Premiums placed in this segment grew by 309% in Q4 2024, amounting to $204.91 million, compared to $50.16 million in Q4 2023. For the full year, Insurance Distribution premiums reached $493.37 million, up 114% from $230.61 million in 2023.

In the Specialty P&C insurance production segment, total premiums for the quarter amounted to $264.90 million, a substantial 88% increase from the same period in 2023. On a full-year basis, premiums rose by 74% to $876.14 million.

Ambac’s investment results were slightly mixed for Q4 2024, but the company still reported a stable investment income. For the quarter, net investment income totalled $3.56 million, comparable to the $3.59 million generated in Q4 2023. Over the full year, net investment income reached $14.45 million, a marginal increase from $13.16 million in 2023.

Notably, the company experienced a net loss from investment gains and derivative contracts, which amounted to $2.04 million for Q4 2024, compared to a gain of $4.02 million in the same period last year.

Claude LeBlanc, President and Chief Executive Officer, commented: “Our P&C operating businesses had record performances in 2024, generating nearly $900 million in premiums across the platform. Cirrata earned nearly $20 million of Adjusted EBITDA, up from $11 million the prior year, and Everspan contributed another $5 million, an increase of 400% over last year.

“We continue to focus on our growth strategy, which is anchored in both strategic acquisitions and organic growth, driven primarily by the launch of new MGAs. On the new MGA launch front, we more than doubled our expectations last year with the launch of six new MGAs, four since acquiring Beat. Looking at 2025 our pipeline for organic and strategic growth remains very strong. Our commitment to technology, efficiency, and talent keeps Ambac at the forefront in terms of delivering innovation and market expansion and positions us well to enhance value for our shareholders.”

LeBlanc continued: “In addition to expanding our P&C business, in early 2025 we substantially completed the separation of our legacy and P&C businesses’ financial and technology platforms to ensure a smooth transition ahead of the close of the Legacy sale. The close of the sale remains subject only to Wisconsin regulatory approval, which we anticipate later this quarter or early next quarter. I look forward to a very exciting year for Ambac in 2025.”

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