Specialist insurer Beazley has reported record profit before tax of $1.423 billion for full year 2024, up 13% on the prior year’s $1.254 billion, as insurance written premiums rose 10% year-on-year to $6.164 million on the back of growth in the majority of divisions.
Group-wide, Beazley generated an insurance service result of $1.236 billion in 2024, down slightly on 2023’s $1.251 billion. Net insurance finance expense fell from -$153.4 million in 2023 to -$55.9 million in 2024, as net investment income increased to $574.4 million from $480.2 million. This all resulted in a net insurance and financial result of $1.754 billion for 2024, an increase of 11% on the prior year’s $1.577 billion.
During the year, other income rose to $106 million from $78.5 million, while operating expenses increased to $388.6 million from $365.8 million. Beazley also booked some slight foreign exchange losses compared with gains in 2023, as finance costs came down slightly to $39.3 million.
As a result, Beazley has reported record profit before tax of $1.423 billion for 2024, and profit after tax of $1.13 billion, compared with profit after tax of $1.026 billion in 2023.
The insurer’s claims ratio was higher in 2024 at 43.1% (39.4% 2023) and the expense ratio was flat at 31.7% (31.6% 2023), driving a combined ratio of 74.8%, which is higher than 2023’s 71% but still very strong.
In terms of claims, Beazley highlights an active second half of 2024 characterised by Hurricanes Helene and Milton.
In 2024, Beazley’s allocation of reinsurance premium decreased by 32.1% to $764.9 million following a period of actively purchasing less proportional reinsurance within its Cyber Risks and Specialty Risks divisions year-on-year. Amounts recoverable from reinsurers for incurred claims decreased to $255.8 million in 2024 from 2023’s $528.5 million.
Given that prior year gross claims estimates have decreased, together with the reduction in reinsurance coverage purchased, the amounts recoverable from reinsurers has also reduced, explains Beazley. Reinsurers’ share of directly attributable expenses has increased to $4.4 million in 2024 from $3.6 million in 2023.
“Our record profit of $1.4bn, along with a 79% undiscounted combined ratio and strong premium growth is a testament to the strength of our expertise. I am delighted with what our company has achieved amidst a challenging claims environment, including an active hurricane season,” said Adrian Cox, Chief Executive Officer.
“This robust performance enables a share buyback of $500m as well as an ordinary dividend rebase to 25p, which is a 76% increase. We remain well capitalised to take advantage of growth opportunities in an evolving market and sustain our strong financial performance over the long term,” he added.
Before discussing the insurer’s different segments, it’s worth noting that Beazley has pegged its net losses from the January 2025 Los Angeles, California wildfires at around $80 million.
In terms of premiums, all divisions but MAP Risks grew year-on-year in 2024. Cyber Risks premiums increased to $1.276 billion from $1.184 billion, Digital premiums rose to $246.6 million from $227.5 million, Property Risks increased to $1.703 billion from $1.351 billion, and Specialty Risks premiums rose to $1.988 billion from $1.873 billion. MAP Risks premiums fell to $950.3 million from $964.3 million in 2023.
Turning to net insurance written premiums, the Cyber Risks division witnessed a decline to $860.5 million in 2024 from $912.9 million in 2023, as Digital net premiums increased to $207 million from $202.4 million, MAP Risks increased to $859.3 million from $851.6 million, Property Risks increased to $1.454 billion from $1.157 billion, and Specialty Risks net premiums totalled $1.77 billion, up from $1.572 billion in 2023.
Segment results were very solid in 2024, driven by Specialty Risks at $476.5 million, an increase of 15% year-on-year. In Property Risks, the result increased by 11% to $391.2 million, and increased by 15% within MAP Risks to $182.6 million, and by 16% to $355.4 million in Cyber Risks. In Digital, the result fell by almost 4% to $57.1 million.
During 2024, Cyber Risks and Digital experienced an average rate change of -5.5% and -3.2%, respectively, while MAP Risks, Property Risks, and Specialty Risks witnessed an average positive rate change of 1.3%, 1.3%, and 1.4%, respectively. However, given the steeper declines in Cyber Risks and Digital, Beazley has reported an average rate decrease of -0.5% for 2024, compared with a gain of 4.3% in 2023.
Cox added: “I am excited to once again deliver a record profit. This level of success, even as 2024 offered a challenging risk landscape and a moderating rating environment, is testament to the talent and hard work of the entire Beazley team as well as the support of our broker partners and the ongoing commitment of our investors. I am grateful to all of you and look forward to what we will achieve together in 2025.
“There is significant long-term opportunity for our business in this era of accelerating risk, which means our clients need our expertise and strong underwriting capabilities. And, as we demonstrated again in 2024, Beazley is a market leader that can deliver against that opportunity as we move forward.
“We do operate in a cyclical market and one where conditions can change quickly. The industry continues to navigate an active claims environment, including recent natural catastrophe activity which could result in the pricing outlook evolving. However our central expectation at this time is that prices will continue to soften this year, and we are forecasting mid-single digit growth for 2025. Accounting for the provision already made in respect of the January 2025 Wildfires, we expect to deliver a mid-80s undiscounted combined ratio.”
