General insurance start-up IronRock closed its first full year of operation with a loss of $48 million, but Managing Director R. Evan Thwaites says the numbers are in line with expectations.
“We are pretty much bang on with our predictions, so to that extent we are pleased,” he said in an interview with Gleaner Business. The company does not expect to make a full-year profit until around 2019.
Gross premiums year end December 2016 amounted to $127.3 million, and the company earned an additional $11 million in commissions, but operating expenses and the cost of writing business overtook revenues, leading to an underwriting loss of $80 million.
The underwriting loss was partially offset by foreign exchange gains and investment income, narrowing net losses to $48.2 million.
Thwaites said operating Expenses associated with the full establishment of the company amounted to $91 million, funds spent, he said, to put IronRock on a firm footing, while catching its bearings in a competitive market.
“Our projections were based on that model, that is, to develop a sound portfolio in the first year, bed down the company, make sure all our systems were up to scratch, and so on – really developing a basis for growth going forward,” Thwaites said.
He noted that the company closed the year with a low claims ratio – that is, the amount of claims measured against the premiums written – and that claims totalling $1.9 million were well below projections.
