E&S specialist Kinsale grows GWP 34% in Q4

Excess and surplus lines (E&S) insurer Kinsale Capital Group has reported its gross written premiums increased 33.7 percent in the fourth quarter while its combined ratio improved to 81.6 percent.

The Richmond, Virginia-based specialty insurer reported net operating earnings of $26.3mn, up 83.8 percent on the $14.3mn in the fourth quarter of 2019.

Net operating earnings per diluted share were $1.14, up from $0.63 in Q4 2019. This beat the consensus $0.79 estimate of seven analysts tracked by MarketWatch.

Gross written premiums grew to $149.9mn in the quarter, compared to $112.1mn in the fourth quarter of 2019.

Underwriting income increased to $21.6mn, up 88.1 percent on the prior year quarter.

The 81.6 percent combined ratio for the quarter compared with 86.1 percent in Q4 2019.

Kinsale president and CEO Michael Kehoe described Q4 2020 as “another strong quarter” and said the company is “optimistic about delivering another successful year in 2021”.

“This past year provided remarkable opportunities as well as challenges,” he said. “We again capitalized on favourable market conditions where we generated record premium growth during the year of 42 percent, while successfully navigating through heightened catastrophe levels and the impact of the pandemic.”

Net operating earnings for the full year 2020 increased by 35.8 percent to $72.3mn compared to the full year of 2019.

Gross written premium grew 41.9 percent in 2020 to $552.8mn compared with 2019.

The combined ratio for 2020 was 86.7 percent, a worsening from the 84.7 percent in 2019.

Kinsale was founded in 2009 and focuses exclusively on the E&S market. In 2019 its biggest lines of business in terms of gross written premium were construction (18 percent), small business (16 percent), excess casualty (13 percent) and commercial property (8 percent).

Kinsale’s strong growth in 2020 comes against a backdrop of string rate increases and burgeoning demand in the E&S market.

AM Best earlier today changed its outlook on the E&S market to stable from negative, citing the segment’s continuing profitability and premium growth.