Marine insurer Skuld ended the first nine months of the 2017/18 reporting year (as at 20 November) with a positive bottom-line result of USD 27 million (up 68.7%, from USD 16 million year-on-year) with the contingency reserve standing at a record high of USD 421 million (up 15.6%, from USD 364 million year-on-year).
Ståle Hansen, Skuld president and CEO, said: "The first nine months have been challenging for some of our members who have experienced major losses. The number of small claims is low, but after nine months Skuld has experienced a few large claims and one confirmed pool claim. Hurricanes Irma and Harvey also had an impact on Skuld's loss estimates although the effect has been limited compared with other insurers in the market.
"It is important for Skuld to embrace such challenges as an opportunity to show what our club is all about: first-class service and competence which our members can rely on. Our highly experienced claims teams provide high-quality service when it is crucial for our members."
The major claims were partly offset by the positive contribution from Skuld's commercial operations. At the end of the third quarter the technical result amounted to USD -13 million with an overall combined ratio of 104%.
Hansen added: "Skuld's diversification strategy continues to reduce our volatility and has contributed positively to the bottom line for the past 10 years. The commercial activities delivered a combined ratio of 92%. Skuld's strong financial performance enables us to show our commitment to our mutual members by giving something back. The mutual members' credit was approved at the Annual General Meeting and the credit of 2,5% was given back to all mutual members on the November payment instalment."
Net investment income ended at USD 40.2 million with an investment return of 5.6%, mainly driven by strong equity markets and lower interest rates. Skuld's long-term conservative investment strategy, with a majority in low-risk bonds, remains unchanged and will reduce volatility and ensure sufficient capital for sustainable growth in the future.