Everest Re Group Reports Fourth Quarter and Full Year 2020 Results: Full Year Net Income of $514 Million

Rhea-AI Summary

Everest Re Group reported its Q4 and full year 2020 results, highlighting a net income of $64 million ($1.59 per share) and a net operating loss of $(44) million ($(1.12) per share) for Q4. The full year net income reached $514 million ($12.78 per diluted share), with gross written premium growth of 15%. The attritional combined ratio improved to 87.5%, despite pandemic-related losses totaling $511 million. Shareholders’ equity increased to a record $9.7 billion, with book value per share growing by 11.4%.

Positive

• Net income of $514 million and net operating income of $300 million for the full year 2020.
• Gross written premium growth of 15% for the full year.
• Attritional combined ratio improved to 87.5%, indicating better underwriting profitability.
• Record shareholders' equity of $9.7 billion, up from $9.1 billion.
• Resilient investment income of $642 million despite pandemic challenges.

Negative

• Net operating loss of $(44) million in Q4 2020.
• Pandemic-related losses amounted to $(511) million.
• Prior accident year reserve strengthening of $400 million.

Everest Re Group, Ltd. (“Everest” or the “Company”) today reported its 2020 fourth quarter and year end results.

Fourth Quarter 2020 Highlights

• Net income of $64 million equal to $1.59 per share
• Net operating loss of $(44) million, $(1.12) per common share
• Gross written premium growth of 13%
• Attritional combined ratio of 86.3%, a 4 point improvement year over year
• Pre-tax net catastrophe losses of $70 million, Covid-19 Pandemic (“Pandemic”) losses of $76 million, and a prior year reserve strengthening of $400 million

Full Year 2020 Highlights

• Net income of $514 million, $12.78 per diluted common share
• Net operating income of $300 million, $7.46 per diluted common share
• Growth in diluted book value per share of 11.4% inclusive of dividends
• Gross written premium growth of 15%
• Attritional combined ratio of 87.5%, ~ 1 point improvement year over year
• 2020 cash flow from operations of $2.9 billion

The following table summarizes the Company’s net income and related financial metrics and provides details on shareholders’ equity and book value per share.

Net income and operating income		Q4		Full Year			Q4		Full Year
All values in USD millions except for per share amounts and percentages		2020		2020			2019		2019
Everest Re Group
Net income		63.6		514.2			217.6		1,009.5
Net operating income (loss)		(44.2	)	300.1			130.8		872.4
Net income per diluted common share		1.59		12.78			5.32		24.70
Net operating income (loss) per diluted common share		(1.12	)	7.46			3.20		21.34
Net income annualized return on average equity		2.8	%	5.8	%		10.0	%	12.0	%
Net operating income annualized return on average equity		-2.0	%	3.4	%		6.0	%	10.3	%
Year end equity and book value
Shareholders' equity				9,726.2					9,132.9
Book value per share				243.25					223.85
Growth in bvps adjusted for dividends				11.4	%				18.7	%
Notes
1/ Refer to the reconciliation of net income to net operating income found later in this release

Everest Re Group President & CEO Juan C. Andrade commented: “We are relentlessly executing our strategies from a position of strength in this robust market as evidenced by 2020 growth in gross written premiums of 15% and net written premiums of 17% and improvement in underlying underwriting profitability. Our attritional combined ratio improved approximately one point to 87.5% versus the prior year, with our Insurance segment improving 2.3 points to 94.2%. Despite the $511 million Pandemic loss provision and a $400 million prior accident year reserve strengthening, we delivered $300 million in operating income and $514 million in net income providing a return on equity of 5.8%. Everest’s investment income remained resilient at $642 million despite the Pandemic’s impact on financial markets and the sharp decline in interest rates. Our total shareholders’ equity grew to a record $9.7 billion from $9.1 billion during the year, representing net book value per share growth of 11.4% including dividends. Everest has a strong capital position bolstered by the $1.0 billion senior notes offering and a leading global franchise with great momentum entering 2021.”

The following information summarizes the Company’s underwriting results, on a consolidated basis and also by segment – Reinsurance and Insurance, with selected commentary on results by segment.

Underwriting information - Everest Re Group

Q4

Full Year

Q4

Full Year

Year on year change

FAQ

What were Everest Re Group's Q4 2020 net income results?

Everest Re Group reported a Q4 2020 net income of $64 million, or $1.59 per share.

How did Everest Re Group perform in 2020?

For 2020, Everest Re Group posted a net income of $514 million, $12.78 per diluted share, with an operating income of $300 million.

What is the growth in gross written premiums for Everest Re Group in 2020?

The company reported a gross written premium growth of 15% for the full year 2020.

What was the attritional combined ratio for Everest Re Group in 2020?

The attritional combined ratio improved to 87.5% for the full year 2020.

Did Everest Re Group face any significant losses in 2020?

Yes, Everest experienced pandemic-related losses of $(511) million and a prior year reserve strengthening of $400 million.