Nephila specialty Syndicate 2358 premiums & profits more than double

2023 saw strong growth for insurance and reinsurance linked investment manager Nephila Capital’s specialty lines focused Syndicate 2358 at Lloyd’s, which more than doubled both its gross written premium and its profit for the year.

It’s second full underwriting year saw the Nephila specialty Syndicate 2358 with an 80% increase in stamp capacity over its debut year, which has allowed it write significantly more business across the balanced specialty lines approach it follows.

In 2022, the syndicate underwrote $48.6 million in premium, but that ballooned by nearly 150% to $120.8 million in 2023.

Nephila launched Syndicate 2358 at Lloyd’s for the 2022 underwriting year, as its first vehicle with a pure specialty lines of insurance and reinsurance underwriting focus, as the investment manager looked to expand its sourcing of risk through the London marketplace.

The goal has been to write a balanced book of insurance and reinsurance, across lines including casualty, motor, marine, aviation, property and reinsurance.

That focus remained in 2023, with expansion across all of those classes of business last year.

Specialty property was a particular area of expansion, rising from $11.5 million to over $47 million in 2023, while inwards reinsurance grew from $2.5 million to $14.7 million last year.

On the back of the $120.8 million of premium written, Nephila’s specialty lines Syndicate 2358 experienced a higher loss ratio than the year before, but the combined ratio was a still profitable 94.4%, albeit up on 2022’s 88.3%.

Which meant that the syndicate’s profit for the full-year 2023 came out at almost $5.5 million, more than double the almost $2.3 million of the prior year.

At this stage, the still open 2022 year of account is reported to have a return on stamp capacity of 16.2%, which is a good result for Nephila in its first year of underwriting specialty lines business at Lloyd’s.

Nephila Capital is now aiming to build on the first two years of profitable underwriting with syndicate 2358, with its stamp capacity target for 2024 set as $190.5 million, up 70% on the prior year $112 million.

Nephila is taking a similar approach with its specialty syndicate 2358 as it had taken with flagship syndicate 2357, of steady growth and building out a profitable book at Lloyd’s.

With now two years of profitable underwriting behind it, Nephila’s Syndicate 2358 looks primed to expand the specialty lines strategy further, while the first two underwriting years look set to deliver attractive returns to the ILS investment strategies that underpin their capital provision.

Also read: Nephila Syndicate 2357 profit rises 65% to $312m on 25.5% CR