Lancashire Holdings Ltd shares fell on Thursday as it reported increased insurance expenses, though pretax profit was steady.
The Bermuda-based insurer said pretax profit increased 1.2% to $336.7 million in 2024 from $332.7 million in 2023.
Shares in Lancashire Holdings were down 5.8% to 585.00 pence in London on Thursday afternoon.
Insurance revenue was up 16% to $1.77 billion from $1.52 billion in 2023. Insurance service expenses increased 70% to $1.19 billion from $696.2 million.
The net investment return grew 1.1% to $162.2 million from $160.5 million.
Lancashire declared a final dividend of $0.15 per share, unchanged from the previous year. It also declared a special dividend of $0.25 per share, giving a total year-end dividend of $0.40.
In 2024, it paid $1.475 in dividends to shareholders, more than doubled from $0.650 in 2023.
Lancashire said its net losses from catastrophe, weather and large loss events totalled $214.1 million, double the $106.1 million recorded in 2023. It said hurricane Milton was the most significant weather event of the year.
The MV Dali Baltimore bridge collision was the most significant large risk event of the year, Lancashire noted. Six people died when a fully laden cargo ship crashed into a bridge in Baltimore harbour, causing the bridge to collapse.
Looking ahead to 2025, Lancashire expects between $145 million to $165 million impact from the California wildfires in January.
With a similar level of catastrophe and large losses as 2024 in addition to the wildfire, Lancashire would anticipate delivering a change in diluted book value per share, or RoE, in the mid-teens percentage in 2025, it said.
‘While this assumes a significantly above average loss environment, our guidance clearly demonstrates the continued delivery of our strategy of more predictable returns for investors,’ Chief Executive Officer Alex Maloney said.
Lancashire’s RoE was 23.4% in 2024, down from 24.7% in 2023.
CEO Alex Maloney said: ‘In a year of high industry losses this is an outstanding result. It shows the continued successful execution of our strategy to grow materially at the right time in the underwriting cycle, utilise our capital more efficiently, diversify our portfolio to reduce volatility, and retain and attract the best talent.
‘Returning excess capital generated to our shareholders has always been a core part of Lancashire‘s DNA and, importantly, we remain extremely well capitalised to fund future growth opportunities.’
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