Conditions in the insurance sector are not getting any easier, even if Lancashire Holdings seems to be successfully swimming against the tide. Its results for 2016, therefore, along with some good figures from Beazley last week, can be seen as a snapshot for the sector as a whole.
Lancashire’s figures are not too bad even if the fourth quarter seems to show some deterioration, the fall in total gross premiums accelerating slightly. The problem continues to be the amount of capital that is flowing into the sector as investors seek a return not available elsewhere. This pushes down the premiums insurers can charge.
There are various ways the industry can counter this. Lancashire is protecting its core business while refusing to take on unattractive business.