REINSURANCE BUSINESS REDUCED AT NOVAE; FOSH SAYS PROGRESS IS BEING MAINTAINED

UK-listed re/insurer Novae wrote gross written premiums (GWP) of £184.6m ($286.9m) for the first three months of 2013, down from £231.1m in the same period last year, the company said this morning. The decline was attributed to a reduction in reinsurance premiums, where the majority of the decline was due to the discontinuance of the engineering treaty account and a substantial reduction in motor treaty business. In insurance, GWP reached £105.0m in Q1, slightly down from the £106.1m achieved in Q1 2012. The insurance sector represented 57% of total GWP, up from 46% in the same period last year. For 2013 as a whole the split is expected to be 70% insurance and 30% reinsurance. Reinsurance premiums declined to £79.6m from £125.0m. GWP in Q1 represented about 32% of planned premiums for the year, down from 37% in Q1 2012. Novae said that during Q1 the marine and energy insurance businesses performed well, "improving on an already good performance in the first quarter of last year". Good performances were also seen in direct property, political risk and credit. However, "the financial institutions and professional indemnity units were not able to repeat the strong performance in the first quarter of 2012" This was offset by an improved result on direct liability. In reinsurance the only significant catastrophe event in claims terms was cyclone and flood activity in Australia. The generally benign claims experience was offset by a lower contribution from the marine and aviation unit, which had performed strongly in Q1 2012. Novae reported a 1% increase in rates on renewal on a whole account basis, roughly similar to the rate increases achieved in the first quarter of 2012. Looking ahead to the rest of 2013, Novae said that "the absence of a major impact from natural catastrophe losses contributed to a promising start to the year for the Group as a whole". It noted that 2011 and prior underwriting years were stable, while the 2012 and 2013 underwriting years were performing in line with expectations.