1st Quarter 2017 Financial Commentary
Highlights from the first three months include:
Distribution of $25.0 million paid to policyholders of record at December 31, 2016.
Policyholders’ Surplus grew to $1.07 billion, an increase of $39.9 million since December 31, 2016.
Written premiums totaled $13.4 million and $13.6 million for the three months ended March 31, 2017 and 2016, respectively.
Total return on EIM’s investment portfolio was 2.6% for the first three months of 2017 compared to 1.4% for the same period 2016.
Membership retention of 100% was achieved in the first three months of 2017.
Energy Insurance Mutual Limited ("EIM") recorded a gain on surplus of $39.9 million for the three months ended March 31, 2017 compared to $17.6 million for the same period 2016. During the first three months, EIM recorded income from underwriting of $20.4 million in 2017 compared to $5.0 million in 2016. Current year losses and expenses are favorable resulting in a combined ratio of 40.7%. During the prior period in 2016, EIM experienced unfavorable development on prior year claims in the general liability line of business.
Income from dividends, interest and realized gains on alternative investments and sales of investments was $23.3 million and $12.3 million for the three months ended March 31, 2017 and 2016, respectively. Reported investment performance experienced favorability in the first three months due to mark-to-market increases in the value of EIM’s portfolio. This resulted in other comprehensive income of $9.8 million comprised of net unrealized gains on securities of $17.8 million less reclassification adjustment for net gains realized in net income of $8.0 million, net of tax for the first three months of 2017.
EIM’s return on investments of 2.6% is primarily a result of gains on US equities of 6.0%, Non-US equities of 7.4%, tax-exempt bonds of 1.0%, taxable bonds of 1.2% and alternative investments of 1.3%. EIM’s investment portfolio was in line with the overall benchmark for the three months ended March 31, 2017.