OdysseyRe Holdings

Given the challenging underwriting environment in 2007, the improvement in the company’s net income was ultimately due to a greatly improved investment result. But the story is a little less straightforward than the headline figures suggest. Net investment income was significantly (32.0%) down on the year before. However, this decrease was more than compensated for by net realised gains on the sale of invested assets, particularly the sale of derivative securities. So much so that OdysseyRe’s net realised investment gains increased by 185.1% from $189.2mn in 2006 to $595.6mn in 2007

US-based insurance and reinsurance group, OdysseyRe increased its net income by 17.3% from $507.9mn in 2006 to $595.6mn in 2007. This result was achieved in an underwriting environment that was significantly tougher than the year before. Two thousand and six is increasingly being seen as representing a distinct peak in the current market cycle.