Liberty Mutual Holding Company Inc (Liberty Mutual or LMHC) and its subsidiaries finished 2021 with a bang, as seen in its fourth quarter and full-year financial results.
For the three months ended December 31, 2021 (Q4), LMHC's net written premium (NWP) totalled US$11,028 million (approx. SG$14,966 million), up 9.2% from US$10,095 million during the same quarter in 2020. Meanwhile, for the 12 months ended December 31, 2021 (FY21), the insurer's total NWP reached US$43,679 million, up 7.5% from US$40,624 million in the previous year.
Unsurprisingly, LMHC's revenue increased during both periods, with the Q4 revenue totalling US$12,221 million (up 3.6% from US$11,796 million during the same period in 2020) and FY21 revenue totalling US$48,200 million (up 10.1% from US$43,796 million in 2020).
David H. Long, Liberty Mutual chairman and CEO, said the insurer's excellent financial performance during the last quarter and the whole of 2021 was driven by the exceptional returns over the past year in its partnerships, LLC, and other equity method investment portfolio, which produced US$916 million of pre-tax income in the quarter.
“We also continued to make progress in the quarter against our objectives of profitable growth in global retail markets, profit improvement in global risk solutions, and expense management, with net written premium growth in GRM of 8.5%, core combined ratio improvement in GRS of 2.6 points to 91.3%, and a 0.6-point decrease in the group's expense ratio to 29.6%,” Long continued.
Looking ahead to 2022 and beyond, Long said Liberty Mutual will continue to focus on its objectives of profitable growth and build upon its progress to date.
As part of its plans this year, Liberty Global Transaction Solutions (GTS), part of Liberty Mutual Insurance, will retain its underwriting capacity of US$200 million per risk for transactional risk protection for all product lines: warranty and indemnity/representations and warranties, tax liability, and contingent legal risk.
“Our appetite for this risk class remains as strong as ever in 2022,” Liberty GTS president Rowan Bamford said in a recent statement. “Our consistent capacity will allow us to support our clients in what is likely to be a bumper year for the M&A market, following the surge in demand for M&A insurance we saw in 2021.”