Lloyd’s insurer Advent Capital suffered a 76 per cent first-half pre-tax profits fall to £1.6 million despite strong premium growth.

The AIM-quoted company, chaired by market veteran Brian Caudle, increased gross premiums written by 56 per cent to £150 million and doubled net premiums earned to £85.1 million in the six months to June. But expenses, including incurred claims, reinsurance to close premiums and acquisition costs, more than doubled.

Advent, which underwrites property, marine and catastrophe risks, says premium rates and terms have been under pressure in most areas, though a reduced frequency of single-risk property losses in the second quarter did enable the company to increase pre-tax profits in that quarter by £900,000 to £7.1 million.

Looking ahead, Caudle says market conditions are ‘increasingly competitive’. Noting that climate experts predict greater than normal hurricane activity, he warns that ‘if there are any major catastrophe events in the second half of 2008, you can expect us to be involved’.

Of course, major catastrophes and insurance losses should push premiums back up. But the market as yet draws scant comfort from that prospect and has marked the shares, which reached 390p in 2005, down 10p this morning to 165p, valuing the company at £67 million.  

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Advent Capital	AIM	£67.08m	165.00p	0.00p
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Rates continue to weaken			03/03/2008
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