Specialty insurance company Markel Corp. reported that its combined ratio for the second quarter of 2010 was 103 percent, compared to 99 percent for the second quarter of 2009. The combined ratio was 102 percent for the six months ended June 30, 2010 compared to 97 percent for the same period of 2009.
For the six months ended June 30, 2010, the combined ratio included $32.7 million, or four points, of underwriting loss on the Chilean earthquake and the Deepwater Horizon drilling rig explosion, which occurred in February 2010 and April 2010, respectively.
Diluted net income per share of $2.12 for the quarter ended June 30, 2010 compared to $3.34 for the second quarter of 2009. Diluted net income per share was $6.46 for the six months, compared to $5.00 for the same period of 2009..
“We continue to operate in a difficult underwriting environment; however, we remain committed to underwriting profitability in any environment,” said Alan I. Kirshner, chairman and chief executive officer.
Markel International reported gross written premiums of $395.3 million for the six months, compared to $358.1 million for the first half of 2009. The company said the increase of 10 percent was due to additional writings across the majority of Markel International’s UK operating divisions and overseas operations. The growth at the overseas operations was primarily due to Markel International’s Canadian operation Elliot Special Risks which was acquired in the fourth quarter of 2009.
The combined ratio for Markel International was 112 percent for the six months compared to 94 percent for the same period of 2009. The increase in the combined ratio was primarily due to $32.7m or 12 points of underwriting loss related to the Chilean earthquake and Deepwater Horizon explosion.
“These losses were well within our risk appetite for a market loss of this size and represent approximately 6 percentage points of Markel International’s full year premium and less than four percent of Markel International’s capital. The underwriting loss was offset by another strong investment performance and as a consequence shareholder’s equity increased by three percent during the first half of 2010,” said Andy Davies, finance director at Markel International.
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