Reinsurer IRB Brasil saw its net loss decrease in the fourth quarter from a year earlier, amid an improvement in financial and equity results, but recorded cash consumption in the period and an increase in claims.
IRB had a net loss of BRL 370.9 million in the fourth quarter of 2021, a reduction of 42.4% compared to losses of BRL 644.2 million reported for the same period of the previous year.
According to the company, the result was negatively impacted by retained claims, which were 53.7% higher than in the fourth quarter of 2020 and reached R$1.29 billion.
“The increase in the total claims ratio in the fourth quarter is a reflection of the increase in the PSL component (Provisions for Unsettled Claims), which refers to the claims notices that the company received in the period and which showed an increase of 148.3% compared to the fourth quarter. quarter of 2020.”
This increase, according to the company, is mainly due to claims contracted in “underwriting years prior to 2020”.
The total loss ratio was 123.5% in the period, an increase of 31.4 percentage points in the annual comparison.
Premiums written totaled BRL 2.06 billion from October to December, which represents a slight drop of 0.9% on an annual basis, with the decline in operations abroad, part of a strategy already announced by the company, offset by expansion in Brazil .
Retained premium grew by 59.4% and earned premium increased by 14.7%.
The company had a cash consumption of R$ 1.2 billion in the quarter, pressured by the payment of claims and the transfer of premiums for assignment of risks.
The IRB said in the earnings release that the position of not disclosing projections remains maintained.
Source: CNN Brasil
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