Conduit Holdings Limited, the ultimate parent company of Conduit Re, has reported huge growth to its premium writings in the first quarter of 2023.

Issuing a trading update, it said Conduit Re, the pure-play reinsurance business based in Bermuda, recorded $443.2 million of estimated ultimate premiums written in the quarter, a 50.7 per cent increase on the three months ended March 31, 2022.

Gross premiums written were $278 million, a 59.1 per cent increase over the prior-year quarter.

The overall portfolio risk-adjusted rate change for the first quarter, net of claims inflation, was 19 per cent.

Despite an active natural catastrophe quarter of losses for the industry, the company said no major event loss, individually or in aggregate, had an outsized or material impact on Conduit Re.

About $132.6 million of estimated ultimate gross premiums were written during the April renewals, bringing estimated ultimate gross premiums written to $575.8 million from January 1 to April 30.

Trevor Carvey, the chief executive, said: “The imbalance between supply and demand continues in the marketplace and Conduit Re has seen a very strong first quarter both in terms of premium growth and the rating levels seen across our target classes.

“April business renewed through strongly and we continue to dial our book deliberately towards the property and specialty classes where the market environment is considered most favourable.

“The overall signs are that pricing momentum will be maintained into the important midyear renewals, and our highly scalable and lean operating model has created a platform for strong future growth."

The company said its high-quality investment portfolio, with an average credit quality of AA, produced an investment return of 1.8 per cent, book yield of 2.8 per cent and a market yield of 5 per cent.

Conduit recorded an unrealised gain of $12.5 million compared with an unrealised loss of $32.6 million in the prior-year quarter.

An outlook from Conduit included this assessment: “Market conditions remain very favourable with property and specialty leading the way ahead of casualty driven by fundamental re-pricing of risk and growing demand for reinsurance while supply remains constrained; continuing risk-adjusted rate increases, augmented by improvements in terms and conditions; enduring momentum into April, ahead of the midyear renewals.”

It added: “Conduit Re will continue prioritising the most attractive classes of business within an exceptional, sustainable pricing environment, accelerating its trajectory towards a mid-80s combined ratio and benefiting from retrocession protection in place — purchased early in the year to support growth strategy and ensure certainty of cover; legacy-free balance sheet and a healthy excess capital position; highly efficient underwriting platform: low other operating expense ratio of 7.1 per cent for the full-year 2022.”

Neil Eckert, executive chairman, said: “As the year progresses, the capacity constraint in the market becomes increasingly acute. We see this as an enduring pricing environment, creating the opportunity for improved margins in our business throughout 2023 and beyond.

“Conduit continues to deliver strong year-on-year growth. Our current ultimate premium growth is ahead of the original five year IPO plan expectations and the true value of our strong balance sheet is becoming more apparent as time passes.”