Everest Group quarterly profit jumps on reinsurance strength, investment gains

Everest

31/07/2024 22:34

July 31 (Reuters) - Everest Group  EG.N  reported an 8%
rise in second-quarter profit on Wednesday, as the reinsurer
benefited from improved investment returns and strong growth in
its reinsurance business.
    Reinsurers have benefited from a favorable environment
thanks to increased pricing, which has boosted both premium
growth and margins.
    They are also increasingly shifting the risk of catastrophe
losses towards primary insurers, analysts have said, reducing
their loss burden.
    Everest, one of the world's biggest property and casualty
reinsurers, said net written premium in its reinsurance segment
surged 15.7% to $3.03 billion for the quarter.
    The company's net investment income rose to $528 million in
the quarter from $357 million a year earlier.
    A significant portion of the company's investment portfolio
consists of bonds, which return better yields in a high interest
rate environment.
    Additionally, stock investments have also benefitted from
the rally driven by an AI boom and hopes of a soft landing for
the economy.
    Bermuda-based Everest provides property, casualty and
specialty reinsurance and insurance offerings across more than
100 countries on six continents. 
    Everest's combined ratio came in at 90.3% in the quarter,
compared with 87.7% a year earlier. A ratio below 100% means the
company earned more from premiums than it paid out in claims.
    Net income rose to $724 million, or $16.70 per share, in the
three months ended June 30, from $670 million, or $16.26 per
share, a year earlier.
    Shares of the company have jumped 11.1% so far this year,
compared to a 14% gain in the benchmark S&P 500  .SPX  index.

 (Reporting by Arasu Kannagi Basil in Bengaluru; Editing by
Mohammed Safi Shamsi and Tasim Zahid)
 ((ArasuKannagi.Basil@thomsonreuters.com;))