Catastrophes push reinsurer’s combined ratio up 18.5 points

Bermuda-based reinsurer PartnerRe made a net profit of $270.6m in the first half of 2010, down 56% on the $625.8m it made in the same period last year. The company’s combined ratio jumped to 103.8% from 85.3%.

Income for the second quarter alone showed a similar pattern, with net profit falling almost 60% to $190.9m from $474.3m. However, the underwriting result remained positive in the second quarter, with the combined ratio increasing to 89.8% from 83.5%, indicating that PartnerRe bore the brunt of its catastrophe losses in the first quarter.

“We had good second quarter 2010 results although there were a number of cross-currents, including the cost of a voluntary termination plan related to the integration of PARIS RE,” said PartnerRe’s outgoing chief executive Patrick Thiele in a statement. “For the half year, we showed strong net written premium growth of 35%, while operating earnings were down due to the combined impact of the Chilean earthquake and the Deepwater Horizon losses, reflecting the normal volatility we expect in our results."

Net written premiums for the first half of the year grew 24.6% to $2.15bn. Net written premiums for the first quarter alone increased 31.7% to $1.11bn.

First-half operating earnings fell 67.2% to $109.7m, while second quarter operating income fell 15.4% to $151.5m.