Large claims outweigh premium growth and positive investment return

Press release

Published: 15 December 2021

Skuld today announces a negative result of USD 20.5 million for the first nine months of the 2021/22 fiscal year compared with a negative result of USD 10 million for the same period last year.

The technical result shows positive development over the past three months, with an improved combined ratio from 127% to 117%. The technical result amounts to a loss of USD 51.7 million, compared with negative USD 46.2 million at the same period last year. The technical result was influenced by several large claims reported through the International Group pooling system as well as some large claims in Skuld’s own portfolio.

Gross premiums and calls ended at USD 309 million, an increase of USD 19.4 million compared with the same period last year. Despite the increase in premium, the continued negative technical result underpins the need to bring the portfolio back into balance through improved rates.

Net investment return of 2.2% partly offset the negative technical result. The value of Skuld’s holdings in developed equity and private markets have continued upwards throughout the year, but expectations of permanently higher inflation have increased yield curves and the US dollar. Recent developments in Covid-19 variants and transmission have caused heightened volatility across financial markets.

Ståle Hansen, Skuld president and CEO, said: “In spite of this disappointing – but not unexpected – result on the mutual book of business, Skuld continues to see positive contributions from our commercial products, remaining firmly committed to our diversification strategy. I remain strongly optimistic about its long-term support of Skuld’s renowned services to members and clients.

“As I said at the six-month report, losses in the marine sector have not abated, and even while they continue to outpace premium income across the marine liability insurance sector, we maintain our leadership position through financial strength and commitment to the highest quality service and support for our members and clients.

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