Lancashire Holdings profits bounce back as catastrophe losses ease

Higher premiums and a strong performance from its investment arm helped Lancashire Holdings Limited (LON:LRE) overcome another battering from tropical storms. Insurance claims were lower than in the previous two years, but the costs of hurricane Dorian and typhoons Faxai and Hagibis still meant losses of US$52.1mln, though in the previous year the catastrophe book deficit was US$104.9mln. Those reduced losses and higher premiums helped boost the combined ratio to 80.9% from 92.2%, while investment returns were 4.9%. Profits for the year jumped to US$113.5mln from US$33.6mln, though the dividend for the year dropped to 15c (35c) as the insurer said it wants to keep hold of capital to take advantage of underwriting opportunities that might arise.  “Our outlook for 2020 is for a continuation of rate improvements,” said chief executive Alex Maloney.