Shares in Protector Forsikring fell 12% on Wednesday after the Norwegian insurer warned about a second-quarter loss, partly because it had lost an arbitration case related to the 2017 Grenfell Tower fire in London.
It said the quarterly loss would be about 128 million Norwegian crowns ($14.8 million) compared to 97.4 million crown profit in the same period a year ago, adding its performance would have been weak even without the arbitration loss.
The loss associated with the arbitration case was about 6.9 million pounds ($8.6 million).
The company said its “price and profitability measures implemented have come too late and are not sufficient.”
Protector was the insurance provider for the Royal Borough of Kensington and Chelsea, which owned the Grenfell Tower in which 72 people were killed when a fire tore through the building in 2017.
An arbitration panel ruled last week against Protector in the firm’s dispute with property reinsurer Munich Re over claims related to the fire. Protector said it was surprised by the ruling and had not booked any reserves for the decision.
The combined ratio that measures losses and expenses in relation to premiums earned would be about 107% for the second quarter, the company said. A figure above 100% indicates a firm is paying out more money in claims than it earns from premiums.
It said the combined ratio for the full-year 2019 would rise but the figure would be published with second-quarter results, which are due out on July 12.
It previously guided for a 2019 combined ratio of about 96%.
($1 = 8.6454 Norwegian crowns)
($1 = 0.8010 pounds) (Reporting by Victoria Klesty Editing by Edmund Blair)
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