Property drives Beazley’s nine-month growth

Lloyd’s insurer Beazley has reported strong growth in property premiums in the first nine months, offsetting slower growth in cyber and reductions in specialty insurance. Written premiums increased by 9% to $4.3bn in the first nine months of 2023, while net written premiums increased by 26% to $3.5bn. Premium rates on renewal business increased by 5%, down from the 17% achieved in the same period last year. “The insurance business is cyclical and market conditions are evolving quickly. We have chosen to exercise underwriting discipline, meaning growth to date is less than we had planned at the start of the year,” said Adrian Cox, Beazley's chief executive officer. The bulk of premium growth in the nine months originated from property insurance, where Beazley reported a 63% increase in premium to £1.1bn, with rate increases of 24%. Beazley said conditions in the property market have been “exceptional” this year and that it anticipates “favourable conditions to continue in to 2024”. Cyber, another important source of premium for Beazley, saw premium increase 4% in the first nine months of 2023 to £872m, with rates falling by 4%. At the same point in 2022, Beazley reported a 66% increase in cyber premiums to $838m, with rate increases of 51%. Beazley said the majority of cyber growth in 2023 has been outside of the US where penetration rates are lower and the medium-term growth prospects are significant. “Given the extraordinary rate rises since 2019, pricing remains adequate in this area. Growth conditions in the US mid-market remain promising, however competition in the SME end of the market and saturation in the large risk space has slowed growth in the US,” the insurer said. Despite an increase in ransomware attacks in 2023, Beazley has not experienced an uptick in cyber claims frequency. “We have taken advantage of the opportunities in the property market this year, with our property risks division growing 63% as rates increased by 24%. In the cyber risks division, we continue to experience sustained, demand-led growth. We remain committed to disciplined underwriting and have delivered a level performance in specialty risks despite significant dislocation in the D&O market,” said Cox. Specialty premiums declined 2% to £1.4bn, with rates down 2%. The reduction in specialty premiums reflected conditions in the D&O market, where rating has been under pressure. “The D&O market remains competitive driving the level performance in specialty risks. We will continue to exercise disciplined underwriting where we are not seeing rate adequacy,” Beazley said in its trading statement. Beazley’s claims experience in the first nine months was better than expected, with the 2023 full-year combined ratio forecast in the low 80s. “Currently, we are confident that there will be no impact on our full-year results as a result of the conflict in the middle east, although we continue to closely monitor the situation,” it said. Cox expects Beazley to produce strong profits for the full year. “Our agile underwriting and the strength of our platform strategy means we have delivered profitable growth to date, and our claims experience is better than anticipated. With sustained discipline and agility in our underwriting, I look forward to reporting a strong profit at year end,” he said.

Property drives Beazley’s nine-month growth

Cyber rates were down 4% while premium income from specialty was reduced

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