SiriusPoint’s CR hits 89% in Q2, net income reaches $109.9m

In their results for the second quarter of 2024, SiriusPoint’s combined ratio deteriorated six points year on year to 89%, compared to the previous year’s 83%, driven primarily by lower favorable prior year loss reserve development.

The company also posted a consolidated underwriting income of $65.1 million, a notable decrease compared to $108.9 million from the prior year quarter, which was also driven by lower favorable prior year loss reserve development.

According to the firm, favorable prior year loss reserve development for the quarter included $16.6 million, which was driven by reserving analyses performed in connection with the company’s 2023 LPT.

However, excluding the favorable development linked to the 2023 LPT, SiriusPoint’s net underwriting income also decreased by $29.3 million for the quarter, compared to the same period last year.

At the same time, SiriusPoint posted a net income of $109.9 million for Q2 2024, as well as a core income of $46.0 million.

Meanwhile, gross premiums written climbed $37.5 million, or 4.7% during the quarter to $842.7 million, compared to $805.2 million from last year, while net premiums earned decreased by $42.8 million, or 7.2%, to $553.4 million compared to $596.2 million from the prior year period.

SiriusPoint noted that the increases in premiums written were primarily driven by increases from Insurance & Services from strategic organic and new program growth, as well as increases across accident & health (A&H).

For Q2 2024, SiriusPoint reports that its reinsurance segment generated an underwriting income of $25.0 million on a 90.2% combined ratio, compared to $61.8 million on a 77.3% combined ratio for the same period last year.

In addition, reinsurance gross premiums written were $352.5 million for the quarter, representing a decrease of $5.2 million, or 1.5%, mostly driven by lower premiums written in New York Casualty, partially offset by increases in Bermuda Property.

The company’s Insurance & Services segment generated an income of $21.0 million for the quarter, compared to an income of $12.0 million from last year.

Insurance & Services gross premiums written were $490.2 million for Q2 2024, a solid increase of $42.7 million, or 9.5%, compared to last year, which was primarily driven by strategic organic and new program growth, as well as increases across A&H, partially offset by the movement of certain lines from Insurance & Services to Corporate.

Focusing attention now on the first half of 2024, SiriusPoint posted a net income of $200.7 million, as well as a core income of $108.4 million, which includes an underwriting income of $81.2 million.

As well as this, SiriusPoint’s combined ratio for H124 sits at 87%, compared to last year’s 78.4%.

Scott Egan, Chief Executive Officer, commented: “We have continued to execute on our ambition to deliver consistent and stable earnings that create long-term shareholder value. We had another strong quarter, our seventh consecutive quarter of positive underwriting income. We report a Combined ratio for the Core operations of 92.5% for the half year, or 92.8% excluding the loss portfolio transfer, which is a 1.0 point improvement over the prior year period on a like-for-like basis.

“We are growing our continuing lines premium in our target areas of North America programs, International and Specialty. Q2 was strong in this regard with growth in gross premiums of 22% for continuing lines business. We have increased our full year 2024 net investment income guidance to $275 million to $285 million up from $250 million to $265 million. Net service fee income from our Consolidated MGAs increased by 6.5% with an improved service margin of 23.9% for the half year. Net income increased to over $200 million for the half year.”

Adding: “We continue to rationalize our MGA equity stakes and realize the significant off-balance sheet value of our Consolidated MGAs. Our total equity stakes in MGAs is down to 22 compared to 36 at the start of 2023. We have also added 11 new distribution partnerships since the start of 2024 providing further evidence of our intent to grow through distribution partnerships in our targeted areas.

“We remain focused on improving our performance, delivering an underlying ROE adjusted for MGA actions of 13.0% within our 12-15% guidance range and growing book value over the medium term. We will continue to drive improvement in 2024 and beyond as we move closer towards our best-in-class ambitions.

“Bolstered by another quarter of strong underwriting results and the completion of our previously announced debt actions, our balance sheet is the strongest it has ever been. Q2’24 BSCR estimate is 284%. This enabled us to reach an agreement for the cash settlement of the Series A Preference shares, purchase and retire $125 million in common stock from CMIG and announce a share buyback authorization increase to $306 million. These actions attest to our belief in the compelling value of our shares and capital position, which is enhanced by strong performance and relentless execution.”

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