August 15, 2024
Insurance News
Fidelis Insurance Group has released its second-quarter report for 2024, revealing a significant drop in net income compared to the same period last year. The company reported a net income of $53.7 million for the April to June 2024 period, down from $83.9 million recorded in Q2 2023. This decline is reflected in the earnings per diluted common share, which stood at $0.46, with an operating net income of $63.0 million, or $0.54 per diluted common share. The report also highlighted that the company faced an income decline in the first quarter of this year as well.
Despite the decrease in net income, Fidelis Insurance reported a positive growth in gross premiums written, which increased by 24.7% to $1.2 billion compared to the second quarter of 2023. The company maintained a combined ratio of 92.7% for Q2 2024, signaling a strong underwriting performance.
Additionally, Fidelis registered an annualized operating return on opening common equity (ROE) and an annualized operating return on average common equity (ROAE) of 10.0%. The company also noted a significant increase in net favorable prior year loss reserve development for Q2 2024, which amounted to $68.6 million, compared to just $2.4 million in the same period last year.
The report also revealed that catastrophe and large losses for the second quarter of 2024 totaled $181.2 million, a significant rise from $85.2 million in the prior year period. Despite these challenges, Fidelis reported a net investment income of $46.0 million for Q2 2024, up from $27.3 million in the previous year. The company strategically invested $677.7 million in fixed-income securities at an average yield of 5.2%, while selling $220.4 million at an average yield of 1.6%.
The growth in gross premiums written was primarily driven by new business and increased rates in the property and property direct and facultative (D&F) lines of business, partially offset by a decrease in the aviation and aerospace line.
Fidelis CEO Dan Burrows expressed optimism for the future, emphasizing the company’s strong market position and ability to adapt to changing conditions. He highlighted the approval of a new $200 million share repurchase program as part of the company’s ongoing commitment to active capital management.
“As we mark our first anniversary as a public company, we are proud to have built a strong team, who are focused on realizing the value of our business. Our position as a market leader focused on short-tail specialty lines is enabling us to deliver attractive growth and create value for our shareholders,” said Burrows. “We are well positioned to quickly respond to market conditions and continue to leverage our lead positioning to capitalize on attractive rates, terms, and conditions. In tandem with underwriting, active capital management remains a cornerstone of our strategy and to that end, we are pleased to announce our Board has approved a new share repurchase program of $200 million. In what remains one of the best markets we have seen in recent history, I am excited for the opportunities we see ahead.
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