Spanish insurer Mapfre said on Thursday that losses from the June 24 earthquakes in Venezuela would be up to €25 million ($28.5 million), after its first-half net profit grew 9.4% despite storm-related claims in Spain and Portugal and negative currency effects in Turkey.
Growing profits and Mapfre’s $1.54 billion acquisition of U.S.-based Safety Insurance, also announced on Thursday, demonstrate a push for expansion even as it absorbs geopolitical and catastrophe-related headwinds.
- Storms in Portugal and Spain cost Mapfre about €50 million in Q1, which was absorbed without major difficulty, CFO Jose Luis Jimenez said
- Result in Turkey was hit by Q1 floods, €14 million hyperinflation adjustment and 12.4% lira depreciation
- Non-life combined ratio, a profitability measure where a lower figure indicates better performance, improved to 92.8% from 93.1%
- Mapfre is cautiously optimistic for the second half and on track to meet 2024-2026 goals
- Safety Insurance acquisition to boost net profit by 5% once fully integrated
- Jimenez said the deal would benefit Mapfre “from a strategic and a financial perspective” and add value from the start
- Shares down 5% by 1005 GMT, with analysts pointing to mixed results
The city has selected Pinnacle Actuarial Resources to provide actuarial analysis and technical support.
Also, the city has issued a Request for Expression of Interest (RFEI) to the private sector seeking proposals to design, structure and operate an insurance program capable of reducing premiums by at least 20% for a meaningful share of the city’s affordable and rent-stabilized housing stock.
Mayor Zohran Kwame Mamdani announced his intentionto create the insurance program in April as part of a broad affordable housing agenda. He has promised the city will invest $100 million in the program with a goal of insuring 20,000 homes next year and 100,000 homes by 2030.
In addition to lowering insurance costs for providers of affordable and rent-stabilized housing, the city believes the proposed entity will also drive down its spending in its affordable housing programs because every $100 increase in insurance costs requires $1,200 more in city capital in new transactions.
New York City affordable housing liability insurance premiums increased at an annual rate of 21% between 2019 and 2023, according to a March 2024 report by the New York Housing Conference (NYHC). The NYHC report said rising costs discourage the development of new affordable housing, place pressure on affordable rents and carrying charges, and force current operators to defer necessary maintenance, adversely impacting housing quality
Through the RFEI, the city hopes to attract submissions from a range of industry participants, including insurance brokers, captive managers, insurance carriers and reinsurers, third-party administrators, actuarial and risk advisory firms and other entities capable of operating at this scale. The city also welcomes joint ventures and proposals that leverage existing vehicles or facilities.