Convex reports loss for 2022 as negative investment return offsets underwriting profit

Global specialty insurer and reinsurer, Convex Group Limited, has reported an underwriting profit for the full-year 2022 with a significantly improved combined ratio, although a negative investment return pushed the firm to a net loss of $142 million for the year.

convex-logoWhile still a loss, at $142 million, it has come down slightly from the $158 million net loss the re/insurer recorded in 2021.

The loss reflects a negative investment return of $107 million for 2022, compared with a positive return of $25 million in 2021, as the adverse impacts of rising inflation and interest rates on global financial markets generated unrealised losses, serving to offset coupon income for the company.

However, underwriting was profitable for the re/insurer in 2022, with Convex reporting an improved combined ratio of 98%, compared with 117% in 2021.

At the same time, gross written premiums increased by a substantial 43% to more than $3 billion in 2022, compared with over $2.1 billion in 2021.

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Net premium earned also increased significantly, by 62% from the $1 billion seen in 2021 to almost $1.7 billion in 2022.

Stephen Catlin, executive chair of Convex Group, commented on the firm’s 2022 performance: “I would like to thank my colleagues for another tremendous year. It’s through their dedication and expertise that Convex continues to build its reputation in the market and to have surpassed $3bn of GWP in less than four years is truly impressive.

“Convex continued to grow and evolve in 2022. In July, Paul Brand assumed the role of group CEO and Convex has thrived under his leadership.

“We continue to experience strong rating conditions and January’s renewals reflected that. However, our market must continue to work hard to provide exceptional service to its clients, as well as demonstrate its value to the wider community after a decade of disappointing returns. I am confident that we, as an industry, are up to the task; this is a period of exciting opportunity and developments for the market.”

Paul Brand, Chief Executive Officer (CEO) of Convex Group, added: “These results reflect the hard work of our colleagues and superb support from our brokers. I’m incredibly proud of what we’ve accomplished. But it’s not just about the numbers. When we launched Convex, building a respectful and thoughtful culture was also a top priority, but we aren’t complacent and continue to invest in our people and culture. 2023 promises to be yet another exciting year, with GWP expected to exceed $4bn.”

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