Beazley : trading statement for the three months ended 31 March 2018

Press

Release

Beazley plc trading statement for the three months ended 31 March 2018

London, 10 May 2018

Overview

· Gross premiums written increased by 10% to $631m (2017: $573m)

· Premium rates on renewal business increased by 3%

· Year to date investment return of zero

Andrew Horton, Chief Executive Officer, said:

"Beazley made a strong start to 2018 with premium growth of 10% on average across the portfolio. We have also seen rate increases across many lines of business as the market recalibrates its pricing in the wake of the high catastrophe activity seen in late 2017.

While our investment return is lower than we would have hoped at this stage, US interest rates are now materially higher which will benefit the business going forward."

Premiums

Gross premiums written for the three months ended 31 March 2018 increased by 10% year on year to $631m.

Our property team have benefitted from the improved underwriting conditions seen in the wake of the high catastrophe frequency experienced at the end of 2017. As such, premiums have increased 29% year on year to $108m.

Our reinsurance division also benefited from improved underwriting conditions with rates increasing 7% across the portfolio, driving an increase in premium of 7% to $90m.

Specialty lines, our largest division, saw premium increase to $295m, a 6% increase. This was driven by a 17% increase in business written within the US.

Our political, accident and contingency division has achieved good growth across a number of areas which has enabled it to increase premiums by 14% year on year despite rate pressures in some areas, in particular terrorism.

Our performance to the end of March 2018 by business division is:

Business update

At the AGM it was announced that after 28 years at Beazley Neil Maidment would be retiring. As such, Neil will step down from the board as of 31 December 2018. Adrian Cox, who has been head of specialty lines since 2008, will succeed Neil as chief underwriting officer.

Also at the AGM, David Roberts formally became the chairman of the Beazley plc board.

Claims update

There have been no major catastrophe events in 2018 and our previous guidance, of a full year combined ratio in the low nineties with below average reserve releases following the natural catastrophes of 2017, is unchanged.

Investments

As at the end of March our portfolio allocationwas as follows:

As at 31 March 2018 we have made a net investment loss of $1.1m, or 0%(31 March 2017: $42.5m gain, 0.9%).Rising US bond yields, widening credit spreads on corporate debt and volatile equity markets combined to create a difficult environment for our investments in this period, resulting in a small loss overall. However, fixed income yields have risen significantly in recent months and this is a positive sign for future investment returns.

The weighted average duration of our fixed income portfolio was 1.4 years at 31 March 2018 (31 March 2017: 1.9 years).

For further information, please contact:

Beazley plc

Christine Oldridge

+44 (0) 207 6747758

Note to editors:

Beazley plc (BEZ.L), is the parent company of specialist insurance businesses with operations in Europe, United States, Canada, Latin America and Asia. Beazley manages seven Lloyd's syndicates and, in 2017, underwrote gross premiums worldwide of $2,343.8 million. All Lloyd's syndicates are rated A by A.M. Best.

Beazley's underwriters in the United States focus on writing a range of specialist insurance products. In the admitted market, coverage is provided by Beazley Insurance Company, Inc., an A.M. Best A rated carrier licensed in all 50 states. In the surplus lines market, coverage is provided by the Beazley syndicates at Lloyd's.

Beazley is a market leader in many of its chosen lines, which include professional indemnity, property, marine, reinsurance, accident and life, and political risks and contingency business.

For more information please go to:www.beazley.com