Conduit Holdings, the parent company of the Bermuda-based reinsurance firm Conduit Re, has issued its trading update for the first quarter of 2024.
During the first three months, Conduit Re recorded $356.8 million in gross premiums written, which represents a 28.3% increase over the same period in 2023. Reinsurance revenue also saw a substantial rise, growing 35.1% to $181.1 million.
The overall portfolio’s risk-adjusted rate change for the quarter, net of claims inflation, was 3%. Notably, the company said that no single event, including the Baltimore Bridge collapse, had a material impact on the company’s financials for the quarter, as losses were within expected limits.
The company’s investment portfolio remained strong, maintaining an average credit quality of AA, with a duration of 2.5 years. The portfolio’s book yield stood at 3.9%, with a market yield of 5.3% as of March 31, 2024.
Looking ahead, the company anticipates that market conditions will remain historically favorable across its targeted business sectors. Conduit Re explained that its strategy includes a conservative investment approach and aiming to maintain a low 80s undiscounted combined ratio.
Greg Roberts, chief underwriting officer, offered additional insights into the operational strategy.
“Conditions remain supportive for our focused and disciplined deployment of capital,” Roberts said. “Our mature relationships with non-admitted and E&S carriers remain a cornerstone of our strategy as we continue to grow in that space. Rating levels are generally strong, and the overall trading environment remains in a very good place and continues to be an ‘underwriters’ market’.”
The company also noted that pricing levels and terms remained attractive throughout the quarter. The non-catastrophe elements of both the property and specialty sectors are providing good opportunities for selective growth.
Despite the active loss period for the industry, Conduit Re said that it managed to avoid significant impacts from event losses, including those related to the Baltimore Bridge collapse. The company’s estimates for undiscounted ultimate loss, net of ceded reinsurance and reinstatement premiums for prior years’ reported loss events, remain stable.
“Following a successful 2023, our momentum was maintained in the first quarter, with growth continuing in line with our plans. The broad trading landscape remains very attractive and we continue to see a significant range of high-quality opportunities. As always, we remain focused on profitability and underwriting discipline, leveraging our efficient operating model,” CEO Trevor Carvey said.
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