November 9, 2001 by Canadian Underwriter
Specialty insurer Kingsway (TSE:KFS, NYSE:KFS) is reporting record earnings and revenue for the third quarter 2001 (ending September 30). Unlike many insurers who have seen abysmal results due to September 11 losses, Canadian-owned Kingsway is posting a net income of $14.3 million, a 47% increase over the $9.7 million reported for third quarter 2000.
Earnings per share also rose, 29%, to a quarterly record of $0.36. Gross written premiums rose 82% to $297.5 million, from $163.2 million for the same period last year. Canadian premiums grew 35%, while U.S. premiums rose 120%. The company attributes premium growth to success in its core non-standard auto and trucking lines, as well as recent partnerships with Access and Reliant in the U.S.
The company also achieved a combined ratio of 96.4% and annualized return on equity of 17%. At the same time, Standard and Poor’s upgraded Kingsway’s senior debt rating to BBB from BBB-, to reflect the company’s strong operating performance.
“It is particularly
gratifying to see the benefit of maintaining our disciplined operating strategy during the soft market conditions in 1999 and 2000 is now starting to come through in our results”, says Kingsway president and CEO Bill Star. “Increased pricing levels as well as a contraction of underwriting capacity in North American markets are creating unprecedented opportunities for us.”