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Tokio Marine Kiln updated forecasts

November 08, 2018

Tokio Marine Kiln updated forecasts

Tokio Marine Kiln Syndicates Limited have released their updated forecasts for the 2016 and 2017 years of account for its three non-aligned syndicates.

  • Syndicates 510 and 557 forecast to deliver profits on the 2016 year of account
  • Syndicates 510 and 557 remain stable for the 2017 year of account
  • Syndicate 308 is loss making on both the 2016 and 2017 years of account, with the 2017 year of account reflecting the impact of the run-off book

2016 year of account results
Syndicate Capacity £m 2016 year of account forecast range % Previous forecast range as at August 2018 %
510 1,062 0.4 to 5.4 -1.0 to 4.0
557 35 12.9 to 17.9 13.6 to 18.6
308 32 -16.9 to -11.9 -14.6 to -9.6

Regarding the 2016 YOA Tokio Marine Kiln has commented:-

“Syndicate 510 has seen an improvement in the forecast range following favourable claims development on the closed years. Syndicate 557 remains stable and on course to make a good profit. There was a deterioration in the forecast loss range for Syndicate 308 following adverse claims development on one account.”

2017 year of account forecasts
Syndicate Capacity £m 2017 year of account forecast range % Previous forecast range as at August 2018 %
510 1,131 -12.7 to -7.7 -12.5 to -7.5
557 34 -32.1 to -27.1 -31.6 to -26.6
308 31 -54.9 to -49.9 -54.8 to -49.8

Regarding the 2017 YOA Tokio Marine Kiln commented:-

“The forecast loss ranges for all three syndicates remain relatively stable. The 2017 year of account for both 510 and 557 was affected by hurricanes Harvey, Irma and Maria, the Mexican earthquakes and the Californian wildfires; and the loss estimates for these events have remained stable in the quarter.”

Please note the previous forecasts, which were announced in August 2018, have been rebased to the same exchange rates (US$1.30 and C$1.69). The above forecasts take into account all managing agency and Lloyd’s charges.

Commenting on the updated forecasts Charles Franks, Chief Executive Officer of Tokio Marine Kiln, said:

“Syndicates 510 and 557 are on track to deliver profits for the 2016 year of account, with 510 showing a modest improvement in its position in August owing to favourable runoff in the closed years.

On pricing, the early strengthening in the market after the 2017 hurricane losses faded quickly in some lines and our review into the most promising business classes, started in the spring of this year, has enabled us to refocus on those lines which we believe offer the best opportunities for profitable growth in the medium term. 510 and 557 forecasts for the 2017 YOA continue to reflect the large catastrophe losses in that year.

Syndicate 308 has been placed into run-off as previously stated and we continue to service the existing business professionally to ensure that there is no detriment to policyholders as a result of this action."