Fairfax Financial Holdings Ltd. posted third-quarter net earnings of $1.15 bn, up from $1.03 bn a year earlier, as stronger underwriting and investment performance offset moderating premium growth.
Net premiums written climbed to $6.62 bn from $6.49 bn. The company said property and casualty insurance and reinsurance premiums grew 2.1% to $6.56 bn, mainly on higher retention in U.S. casualty lines.
All business segments – North America, global, and international – recorded premium gains.
Underwriting profit for the property and casualty division jumped to $540.3 mn from $389.7 mn, while the combined ratio improved 1.9 points to 92.
The better results came as current-period catastrophe losses dropped to $150 mn from $434.5 mn a year ago, easing one of last year’s biggest drags on results.
Investment results added another lift. Fairfax booked $426.2 mn in net investment gains, driven largely by $524.6 mn of gains on common stocks.
Chairman and CEO Prem Watsa said the company continues to sharpen its focus on core property and casualty operations.
We are very pleased to maintain the focus of our insurance operations on property and casualty insurance and reinsurance, while still benefitting from the continued success of the Eurolife life insurance business through our ownership stake in Eurobank
Prem Watsa, Chairman and CEO
Earlier this quarter, Fairfax announced plans to sell 80% of its stake in Eurolife FFH Insurance Group Holdings S.A. for $940.9 mn in cash to Eurobank Ergasias Services and Holdings S.A. or one of its affiliates.
At the same time, Fairfax will acquire a 45% equity interest in Eurobank’s Cyprus-based property and casualty insurer, ERB Asfalistiki, for about $68 mn.
We think the combination keeps Fairfax’s capital working closer to home – heavier on P&C underwriting, lighter on life – while still giving it a financial foothold in Europe’s insurance ecosystem.
