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Jun 30, 2022
W. R. Berkley Q2 2022 Earnings Report
Reported strong second-quarter results driven by underwriting income and net premiums written growth.
Key Takeaways
W. R. Berkley Corporation reported excellent second-quarter results, driven by strong underwriting income and net premiums written growth. The company's combined ratio was 88.6%, and the annualized operating return on beginning stockholders' equity was 18.8%. Net premiums written grew by nearly 17%, and core net investment income grew nearly 30%.
Record gross and net premiums written grew 14.7% and 16.9% to $3.1 billion and $2.6 billion, respectively.
Underwriting income increased 32.6% to $268.2 million.
The current accident year combined ratio before catastrophe losses of 2.5 loss ratio points was 86.2%.
Operating return on equity of 18.8%.
Forward Guidance
W. R. Berkley Corporation is optimistic about the remainder of 2022 and beyond, citing their well-prepared team and well-positioned underwriting and investment portfolios for the uncertainties and challenges of today’s environment, including inflation.
Positive Outlook
- Market conditions remained favorable for most lines of business, with the majority of businesses expanding, particularly in the E&S and specialty markets.
- After several years of compounding rate, most of the businesses are achieving or exceeding target return on equity, with greater emphasis on exposure growth.
- Growth has driven further improvement in the expense ratio.
- Core net investment income grew nearly 30% due primarily to higher yields.
- Investment income will benefit further as interest rates continue to move higher.
Challenges Ahead
- Rising interest rates impacted the value of the Company’s fixed-maturity securities and consequently its book value.
- Challenging equity markets in the first quarter of 2022.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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