Birmingham, AL – ProAssurance Corporation (NYSE: PRA) recently reported results for the three months ended March 31, 2018.
“The trends that we noted in our year-end 2017 earnings release continue to drive our results as we enter 2018. We continue to be encouraged by our ability to grow premiums and maintain strong retention in our Specialty P&C and Workers’ Compensation segments. Specifically, within our Specialty P&C segment, our retention is increasing, as is our pricing on renewing business. This reinforces our belief that the value of ProAssurance is becoming more important in the face of a possible market change due to increased industry concern about upward trends in losses.
The workers’ compensation market remains highly competitive, however our differentiated products and disciplined business strategy are allowing us to add new business and retain existing policyholders at rates we believe meet our long-term return expectations. While there have been short-term challenges in our Lloyd’s segment operations, we continue to believe the investment we are making is the foundation for future success, and will provide us with a window into additional opportunities outside Lloyd’s itself,” said W. Stancil Starnes, Chairman and Chief Executive Officer of ProAssurance.
First Quarter 2018 Highlights
- Consolidated gross premiums written were $11.7 million higher than the year-ago quarter, primarily due to higher premiums in our Workers’ Compensation and Specialty P&C segments. In our Worker’s Compensation segment, gross premiums written were $91.3 million, $7.1 million higher than in the first quarter of 2017. Gross premiums written in our Specialty P&C segment were $140.5 million, $3.7 million higher than in the year-ago quarter. Premiums written in our Lloyd’s segment were $12.4 million, approximately $350,000 less than in the first quarter of 2017.
- Net premiums earned were $187.2 million in the first quarter of 2018, a $4.3 million increase over the same quarter in 2017. Net premiums earned increased $3.2 million and $3.1 million in our Specialty P&C and Workers’ Compensation segments, respectively. Net premiums earned in our Lloyd’s Syndicate segment decreased $2.1 million, reflecting the effect of a revision in our reinsurance agreements at the beginning of 2017.
- Our coordinated sales & marketing programs produced $8.8 million of business in the first quarter of 2018 vs $7.7 million in the first quarter of 2017.
- Net favorable development was $22.8 million in the quarter, as compared to $28.8 million in the year-ago period. There was net favorable development in all operating segments: $20.6 million in Specialty P&C, $1.9 million in Workers’ Compensation and approximately $330,000 in our Lloyd’s segment.
- The consolidated underwriting expense ratio was 0.6 points lower than the same period last year primarily due to lower share-based compensation expenses in our Corporate segment.
- Our net realized investment losses were $12.5 million in the first quarter of 2018, compared to net realized investment gains of $13.3 million in 2017, which primarily reflected mark-to-market adjustments in our equity trading portfolio.
- Our consolidated net investment result for the first quarter of 2018 was $23.7 million, a quarter-over-quarter decrease of $1.3 million due to reduced earnings from our fixed income portfolio, primarily reflecting lower average investment balances.
The complete results release is available here: ProAssurance Results for First Quarter 2018