Brit benefiting from third-party capital growth in 2021: Execs

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Senior executives of specialty insurance and reinsurance player Brit Ltd. said this morning that the company is benefiting from having expanded its third-party capital assets in 2021, resulting in higher fee income being earned as well.

brit-logoBrit Ltd. reported its first-half results this morning, saying that it wrote 14.2% more in gross premiums at over $1.46 billion, while at the same time risk adjusted premium rates rose by 10.2% and that compound premium rate increases secured since January 2018 now stand at 30.4%.

With a combined ratio of 94.6%, Brit has managed to deliver operating profit of $212.5 million and profit after tax of $204.3 million for the first-half of 2021.

Matthew Wilson, Group Chief Executive Officer of Brit Limited, explained, “I am pleased to report a very positive first half of 2021 for Brit, with our underwriting performance and investment return delivering a strong overall result. Underpinning this performance was our continued successful execution against our strategy of Leadership, Innovation and Distribution.”

On the profitably combined ratio, Wilson explained that this, “reflected the combination of a healthy attritional ratio, robust prior year reserve releases and increased income from our third party capital management and MGA businesses, partly offset by the impact of the Texas winter storms and COVID-19 loss activity.”

As we reported earlier this year, Brit had increased its third-party reinsurance capital activities, in particular its Sussex Capital ILS management and collateralised reinsurance platform increased its assets under management to $525 million.

Sussex Capital is an insurance linked securities (ILS) asset management platform that Brit founded in Bermuda in 2017.

It undertakes ILS and collateralised reinsurance across property catastrophe risks and also Lloyd’s specialty business lines.

Gavin Wilkinson, Group Chief Financial Officer of Brit Limited, further commented on the third-party capital business at the company.

Wilkinson said, “We have continued to benefit from the growth of our third party capital vehicles and our investments in MGAs. Working with our capital and distribution partners is an important part of Brit’s strategy, enhancing our leadership position, strengthening our client proposition and making our expense base more efficient.”

Brit’s results suggest a more profitable start to 2021 for investors in the third-party capital vehicles as well, with fewer losses shared with them and more of the firm’s underwriting result attributed to third-party investors.

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