Nine-month revenue growth at 25 leading insurers and reinsurers averaged 13%, but increased loss activity drove up both third-quarter and nine-month combined total expense ratios, according to a report Wednesday from Gallagher Re, the reinsurance unit of Arthur J. Gallagher & Co.
Increased rates for commercial lines drove revenue growth as 17 of the 25 companies in the Gallagher Re data set reported year-on-year, double-digit, nine-month premium growth for 2022.
However, increased loss activity in the third quarter pushed the nine-month aggregate total expense ratio up 1.4 basis points to 96.9% from 95.5% for the first nine months of 2021 and the third quarter total total expense ratio up 3.3 basis points to 102 .1% from 98.8% in the third quarter of 2001.
Insurer and reinsurer performance in the data set was “mixed with just over half of (re)insurers reporting in 100% combined conditions,” the Gallagher Re report said, adding that Scor SA and Swiss Re Reinsurance Co. Ltd. the most significant deterioration in their combined conditions, largely stemming from natural disaster loss activity, including Hurricane Ian.
The report also noted that Russia’s invasion of Ukraine, while not particularly relevant to nine-month results, continues to cast a cloud of uncertainty over future results.
“While not a significant driver of overall nine-month results, some (re)insurers established reserves for claims exposure related to the war in Ukraine. Significant uncertainty remains around final loss estimates,” the report said.