Liberty Mutual rebounds with 64.9% jump in net income
Liberty Mutual Holding Company Inc. and its subsidiaries (collectively, LMHC) has become the latest insurance company to report its financial results for Q1 2021, and the group has posted a net income of $856 million, an increase of 64.9% or $337 million over the same period in 2020.
Commenting on the increase, Liberty Mutual chairman and CEO David H. Long noted it is a result of strong investment results more than offsetting elevated catastrophe losses. Net written premium across LMHC increased 3.6% to $10.4 billion, driven by US personal lines where the group continues to achieve strong PIF growth, over 7% in both personal auto and homeowners.
Revenue for the group in Q1 2021 stands at around $11.82 billion, up 13% from the same period in 2020, while its COVID-related losses reside at $36 million for the quarter.
Meanwhile, sustained pricing momentum in commercial lines resulted in a 12% renewal rate increase within Global Risk Solutions, while expense management combined with strong premium growth drove a one point reduction in the expense ratio to 29.5%. Long highlighted that the group’s partnership, LLC and other equity method investment portfolio produced $838 million in pre-tax operating income. This was due to higher equity valuations, primarily within private capital investments.
“Catastrophe losses in the quarter were $1 billion, up $734 million from the prior-year quarter including $690 million from the February winter storms, which impacted Texas and other states,” he said. “Overall, it was a strong quarter despite an elevated level of catastrophe losses, and we are pleased with the progress we’re making toward key business objectives.”