Conduit Re posts 97.1% combined ratio in 2024 as GWP climbs to $1.16 billion

By Ryan Hewlett

Feb 19 - (The Insurer) - Conduit Holdings, the ultimate parent of London-Bermuda carrier Conduit Re, said on Wednesday that its gross written premiums grew by 24.8% in 2024, with the London-listed reinsurer bullish on continued opportunities for growth despite the full-year impact of elevated catastrophe losses.

• Undiscounted combined ratio of 97.1% (2023: 81.9%)

• Comprehensive income of $125.6 million (2023: $190.8 million)

• $1.16 billion GWP booked in 2024 (2023: $931.4 million)

• California wildfire losses estimated at $100 million to $140 million

• Launched in December 2020 by industry entrepreneur Neil Eckert

The group reported comprehensive income of $125.6 million, a 34.2% decrease on the $190.8 million reported in 2023, resulting in a 12.7% return on equity for the full year.

The carrier, now in its fourth year of operation after launching in December 2020, posted a combined ratio of 91.7% in 2024, a deterioration of 15.2 points year on year. On a discounted basis, Conduit Re reported a combined ratio of 86.0%, a deterioration of 13.9 points year on year.

The deterioration was driven by the impact of an active year for catastrophes, including hurricanes Helene and Milton as well as a series of elevated risk losses.

Conduit Re recorded an undiscounted net loss, after reinsurance and reinstatement premiums, of $68.0 million related to Helene and Milton. The two events contributed 9.4% to the reinsurer’s undiscounted loss ratio for 2024.

Jefferies analyst Philip Kett said the figures showed Conduit Re to be resilient in the face of high catastrophe losses. He noted that GWP beat “bullish” consensus expectations by 2.1% and said the group has now reached “critical mass”.

“Perhaps most importantly, in spite of a disappointing 3Q trading update, where unexpectedly high catastrophe losses weighed on margins, Conduit delivered an attractive ROE for 2024 of 12.7%. This compares well with the target of mid-teens, even if it is lower than the exceptional return in 2023.”

The reinsurer also disclosed a preliminary undiscounted ultimate loss estimate of between $100 million and $140 million, net of reinsurance recoveries and reinstatement premiums, for the January 2025 California wildfires.

Conduit Re’s discounted net loss ratio for the year ended December 31, 2024 was 73.3% compared with 58.2% for 2023, while its undiscounted net loss ratio was 84.4% and 68.0% respectively.

GWP for the 12 months ended December 31, 2024 stood at $1.16 billion, an increase of 24.8% from the prior year. The carrier cited overall portfolio risk-adjusted rate change for 2024, net of claims inflation, of plus 1.0%.

The carrier said it had achieved “deliberate and targeted growth” across all three segments amid continued attractive underwriting opportunities in its target classes.

GWP in property rose 29.5% to $606.3 million, while specialty grew 38.7% to $258.5 million and casualty rose 7.6% to $297.6 million.

Conduit Re reported a total net investment return of $66.1mn for 2024, compared to $70.6 million in 2023.

Trevor Carvey, CEO of Conduit Re, said: “While the business is still exhibiting substantial growth, we now have a demonstrated platform, generating profitable returns even in high industry loss years.

“The company is well capitalised and we expect to continue to build on these achievements as the business grows and matures. We had a solid January 2025 renewal period with extensive support from our existing clients across our multi-line profile. Selective additions of attractive business led to double-digit growth over the 2024 renewal season on an ultimate basis.”