Bermuda-domiciled insurer and reinsurer Everest Group has reported $472 million of pre-tax catastrophe losses, net of recoveries and reinstatement premiums, in the first quarter of 2025, primarily driven by the California wildfires, compared to $85 million in Q1’24, driving an underwriting loss for the firm.
The carrier states that reinstatement premiums were $62 million in Q1’25, while there were none in the prior year quarter.
The quarter’s pre-tax underwriting result saw a group-wide loss of $104 million, $96 million for reinsurance, $5 million for insurance, and $3 million for other segments.
Despite this, Everest has generated positive net income of $210 million and net operating income of $276 million for Q1’25, compared to $733 million and $709 million in Q1’24, respectively.
Group-wide, gross written premiums (GWP) fell to $4.4 billion, decreasing 2% year-over-year, 1.1% in reinsurance, and 0.1% in insurance on a comparable basis.
However, there was strong double-digit growth in property and specialty lines across both segments, offset by reductions in certain casualty lines, explained the re/insurer.
Within the reinsurance segment, GWP dropped to approximately $3.2 billion. The firm says that growth was led by an 11.5% increase in property pro-rata, a 7.9% increase in property catastrophe XOL, and a 7.7% increase in property non-catastrophe XOL, partially offset by a 21.7% decrease in casualty pro-rata and an 8.5% decrease in casualty XOL, when adjusting for reinstatement premiums.
The segment’s attritional loss ratio increased 260 basis points over last year to 59.8%, while the attritional combined ratio increased 270 basis points to 87.1% versus a year ago. The increases were primarily driven by the Washington, D.C. aviation losses, net of recoveries and reinstatement premiums, which added 2.4 points to the attritional loss and combined ratios, explains Everest.
Within reinsurance, pre-tax catastrophe losses were $461 million, net of estimated recoveries and reinstatement premiums, driven primarily by the California Wildfires, which contributed $442 million. Reinstatement premiums were $62 million in Q1 2025, while the prior year quarter was not impacted by reinstatement premiums.
Turning to the insurance segment, GWP decreased to approximately $1.1 billion for Q1’25. However, the firm’s international business continued its strong growth trajectory. Everest Insurance grew by 19% in property/short tail and 16.1% in other specialty lines. The group explained that growth was offset by a decrease of 16.6% in specialty casualty, primarily in North America, 9.9% in professional liability, and 19.8% in workers’ compensation.
Insurance segment pre-tax catastrophe losses were $10 million, net of estimated recoveries and reinstatement premiums, a slight increase over Q1’24, which benefited from benign catastrophe losses.
The Q1’25 combined ratio for the group rose to 102.7% from 88.8% in Q1’24, as catastrophe losses contributed 13.9 points.
For reinsurance, the combined ratio reached 103.3% in Q1 2025, with 18 points from cat losses compared to a combined ratio of 87.3% in Q1’24. Meanwhile, the insurance combined ratio rose to 100.5%, compared to 91.9% in Q1’24.
For the first quarter, total shareholder return was 5.6% annualised, while annualised year-to-date was 5.7% with a net income ROE and 7.5% net operating income ROE.
The firm’s net investment income improved to $491 million compared to $457 million in the prior year quarter. The operating cashflow for the quarter of $928 million compared to $1.1 billion in Q1’24.
Jim Williamson, Everest President and Chief Executive Officer, commented, “The industry experienced the highest level of Q1 catastrophe losses in over a decade, primarily from the California wildfires. As expected, this affected our underwriting results for the quarter. Given our disciplined approach to catastrophe risk underwriting, our losses were within our expected range.
“We continue to see opportunities to deploy capital at excellent expected returns, as evidenced by our successful execution of the January and April first reinsurance renewals. In insurance, the execution of our U.S. casualty remediation remains on track to be completed later this year, while we still see significant opportunities in property and specialty lines. Everest is delivering on its strategic plan, and I am confident in our ability to achieve our return objectives.”
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