Fairfax Financial, the Canadian insurance company that lodged a bid for
Tower, has announced net earnings of US$476.9 million in the third quarter of 2017, compared to net earnings of US$1.3 million in the same period a year ago.
The results include a net after-tax gain of US$930.1 million on the sale of about two-thirds of the company’s equity interest in ICICI Lombard and the adjustment to fair value of the company’s residual interest.
Earlier this year, the Canadian insurance company bid to acquire 100% of Tower for NZ$197 million – a move that had been unanimously supported by the Tower board.
The company said its net earnings in the current reporting period were strong despite incurring significant losses from Hurricanes Harvey, Irma and Maria.
Its net premiums written by its insurance and reinsurance operations increased by 41.4% to US$2,779.5 million (8.3% excluding the acquisitions of
Allied World, Bryte Insurance, AMAG, Fairfirst Insurance and
AIG branches in Latin America and Central and Eastern Europe, all of which were acquired after the third quarter of 2016).
“The third quarter of 2017 reminded us yet again that ours is a risk business,” Fairfax chairman and CEO Prem Watsa said. “Losses for the property and casualty insurance industry from these catastrophes are estimated to be perhaps US$100 billion plus.”
“Fairfax expects to have an excellent year in 2017 in spite of the catastrophe losses, with cash and marketable securities at record levels - and we are prepared if a hard market develops in 2018.”
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