Reinsurer IRB Brasil had a 91.8% decrease in net loss in the third quarter compared to the same period in 2021, due to a higher-than-expected loss ratio due to weather effects in the rural segment.
IRB Brasil had a net loss of BRL 298.7 million between July and September, compared to a loss of BRL 155.7 million a year earlier. On the other hand, the company showed an evolution compared to the second quarter of 2022, when it reported a loss of R$ 373.3 million.
The third-quarter result was “impacted by weather effects that affected rural risk contracts and Covid-19 on the lifeline,” the IRB said in the balance sheet.
The reinsurer had to make a share offering this year to raise around R$ 1.2 billion to meet minimum capital requirements due to new losses, this time linked to claims with the crop failure.
The IRB said that the crop failure due to weather variations generated “significant losses” for rural producers, which took their loss ratio “to unexpected levels” in the quarter, as it already expected to see better results.
The total loss ratio dropped from 119.3% to 116.8% in 12 months, while the premiums issued by the IRB dropped 7.5%, to R$2.4 billion.
Regarding regulatory indicators, the IRB said that it closed the quarter with sufficient adjusted shareholders’ equity in relation to the minimum required capital of R$153.6 million.
The sufficiency in the framework of the coverage of technical provisions and regulatory liquidity stood at 325.9 million reais.
Source: CNN Brasil
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