Peak Re 2022 gross written premiums up 7%; records net loss

It expects to benefit from improved technical results and investment returns for 2023.

Hong Kong-headquartered reinsurer Peak Re recorded a net loss of $81m in 2022-- it's first ever net loss, the reinsurer said in an announcement.

In 2021, Peak Re had recorded a $73.2m profit.

Gross written premiums (GWP) in 2022 climbed 7% year-on-year (YoY) to $2.3b.

Meanwhile, net earned premiums slumped by 12.8% to $1.5b. This was attributed to the reinsurer’s expansion on retrocession protection and support for the issuance of the first-ever 144A cat bond in Hong Kong, through special-purpose insurer Black Kite Re.

“The company’s 2022 underwriting benefited from the hardening of the market at last year’s renewals. However, technical results were impacted by catastrophe losses, including floods in Australia and South Africa, drought and hailstorms in Europe and hurricanes in the US,” the reinsurer said.

In the statement, the company said it “further diversified its portfolio and realigned its book in markets” where natural calamity losses grew exponentially.

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It also noted that Peak Re’s motor, accident & health, and pecuniary services grew. It also established its presence in APAC where 61% of its GWP comes from.

Peak Re’s assets under management amounted to $2.95b for 2022, up 6.2% from the previous year.

Investment income was recorded at $8.3m, as returns were immensely impacted by the fall of equities and market-to-market valuation losses on the bond portfolio.

Overall shareholders' equity saw a drop to $1.2b, from $1.5b in 2021. The year’s solvency ratio was at 209% as of end-December 2022.

The firm also said it hopes to benefit from improved technical results and investment returns for 2023.

“The company further anticipates that the shift to higher-rated and better-yielding fixed-income securities will positively impact on investment returns over the coming years.” said Peak Re.