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NEW YORK - Everest Re (NYSE:EG) Group reported a surprise fourth quarter loss and announced significant reserve strengthening in its U.S. casualty business on Monday after the close. Shares were trading flat shortly after.
Everest Re posted a Q4 net loss of $593 million, or $13.96 per share, compared to net income of $804 million, or $18.53 per share, in the year-ago quarter. Analysts had expected a profit of $12.78 per share. Revenue fell short at $4.03 billion versus estimates of $4.42 billion.
The company took decisive action to strengthen prior year U.S. casualty reserves by $1.1 billion and increased current accident year losses in U.S. casualty lines by $206 million, totaling $1.3 billion. This led to a combined ratio of 239.2% for the Insurance segment in Q4.
"This was a pivotal year for Everest as we took decisive action to fortify our U.S. casualty reserves, solidify our franchise value, and raise the bar across all facets of the Company," said Jim Williamson, Everest President and CEO.
Despite the loss, Everest’s Reinsurance segment performed well, with gross written premiums growing 12.6% YoY to $3.3 billion. The company said risk-adjusted returns remain very attractive, particularly in property and specialty lines.
For the full year 2024, Everest reported net income of $1.37 billion on revenue of $17.28 billion. The company achieved 9.2% total shareholder return and 9.6% net income ROE for the year.
Everest said it expects pre-tax net catastrophe losses of $350-450 million in Q1 2025 from California wildfires, based on an estimated industry loss of $35-45 billion.
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