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Jun 30, 2020
W. R. Berkley Q2 2020 Earnings Report
W. R. Berkley's financial performance was impacted by COVID-19 and catastrophe losses, but benefited from rate increases.
Key Takeaways
W. R. Berkley Corporation reported second quarter results with gross premiums written growing to $2.132 billion. The company faced challenges from the COVID-19 pandemic and other catastrophe losses, but positive rate momentum persisted.
Average rate increases excluding workers' compensation were approximately 13.0%.
The accident year combined ratio before catastrophe losses was 90.2%. The reported combined ratio was 98.7%.
Catastrophes added 8.7 loss ratio points to the reported combined ratio, including 5.1 loss ratio points for COVID-19 related losses.
Book value per share grew 7.7%, before dividends and share repurchases.
Forward Guidance
The company anticipates that re-opening the global economy will have a meaningful favorable impact on their future growth and they are well positioned to realize these opportunities as the economy improves.
Positive Outlook
- Re-opening the global economy is likely to have a meaningful favorable impact on future growth.
- The company is well positioned to realize opportunities as the economy improves.
- Positive rate momentum persisted.
- Growing industry concern over the low interest rate environment and social inflation.
- Current environment has heightened risk awareness.
Challenges Ahead
- Second quarter of 2020 was most notably characterized by the COVID-19 pandemic and its impact on the U.S. and global economies.
- Net investment income was adversely impacted by a $58 million loss from investment funds, which are reported on a one-quarter lag.
- Uncertainty in the financial markets and the economy.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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