Poor performance in investments and underwriting dropped domestic insurer BF&M to a first quarter loss for the period to the end of March.

The company said the $6.7 million loss is compared to the shareholders’ net income for the comparative period in 2021 of $6.5 million.

John Wight, the group chairman and CEO stated: “Our first quarter results were negatively impacted by investment income losses driven by rising interest rates and high stock market volatility. While rising interest rates will benefit the Company over the longer term, the fair value losses experienced in the quarter depressed earnings.”

He added: “In addition underwriting results in both the P&C and Life and Health businesses did not meet expectations.

“Increases in P&C premiums were not sufficient to adequately cover the increases in reinsurance costs. In addition, we are now seeing dynamics which we anticipated several quarters ago during the worst of the pandemic: a backlog of patients seeking elective or diagnostic care is now working its way through the system. This resulted in higher than expected medical claims in the first quarter.

“As a leading insurer in Bermuda and the Caribbean, our capital position remains very strong. As we head into hurricane season, we are ready to meet the needs of our policyholders and shareholders.”

The company reported that equity attributable to shareholders at 31 March 2022, was $304.4 million. General fund assets totalled $1.1 billion, of which $88.0 million was held in cash and cash equivalents. Gross premiums written for the period increased slightly from the prior year to $86.5 million, driven by increased property and group health premiums and new business.

Short term claims and adjustment expenses increased by 10 per cent to $4.6 million. Life and health policy benefits decreased by 161 per cent to -$3.1 million. Operating expenses increased by 2 per cent to $14.0 million for the period.