ERS Syndicate 218: 2019 and 2020 Year of Account Forecasts

ERS has released updated forecasts for the 2019 and 2020 years of account for syndicate 218.

The 2019 forecast range has deteriorated to between -1.59% and +8.40% of capacity (midpoint +3.4% profit). The previous midpoint was +3.8%.

The 2020 forecast range has improved to between +1.49% and +11.49% of capacity (midpoint +6.5% profit). The previous midpoint was +5.9%.

Alpha comment

Several UK motor insurers have reported excellent half year results in recent weeks due to the reduced vehicle usage. It is, therefore, disappointing that the syndicate is reporting a deterioration in its forecast for the 2019 year of account this quarter. This is despite the positive contribution from the 2018 & prior years increasing within this updated forecast. There is some slight good news on the 2020 year, where the midpoint is now 6.5%, which is above the target within the business plan, due to the reduced motor vehicle usage during much of the 2020 calendar year. It is still not that inspiring a result in a year which has seen the loss ratios artificially suppressed, when rates were strong and any extra premium written would have diluted the high expense ratio.