Amlin warns on profit

by Gill Montia

Story link: Amlin warns on profit

Following completion of its second-quarter reserve review, Amlin says it is unlikely to meet previous profit expectations for 2011.

Overall, the specialist re/insurer estimates that it will be £65 million below previous pre-tax profit expectations and £53 million below after-tax expectations.

The firm has seen a material increase in notified claims relating to the New Zealand earthquake, taking total catastrophe claims reserved in the six months to the end of June to £314 million.

At the same time, Amlin Bermuda has had to increase its net major catastrophe reserves and the group’s corporate insurance business has performed below expectations having seen large-claims advices on its property and marine accounts.

However, Syndicate 2001 released reserves of only £6 million in the first half of 2011, with the total approximately £10 million below normal expectations.

In addition, Amlin expects some of the overall profit shortfall to be offset in the second half of the year by increased income from catastrophe reinsurance written in the second quarter, in an improved rating environment.

The firm will be releasing its first-half results on 22nd August.