(Alliance News) - Lancashire Holdings Ltd on Wednesday said it swung to annual profit after insurance revenue improved and expenses fell, thanks to continued demand growth from clients.

The Bermuda-based insurer said insurance revenue rose 24% to USD1.52 billion in 2023 from USD1.23 billion in 2022, while insurance service expenses fell 30% to USD696.2 million from USD994.6 million.

This resulted in a swing to pretax profit of USD332.7 million from a loss of USD17.3 million.

Lancashire Holdings said the "excellent" operating performance allowed it to declare a special dividend of USD0.50 per share, unchanged from its previous special dividend paid in December.

It noted that this followed not completing its share buyback programme of up to USD50 million, as announced in the third quarter of 2023.

Lancashire Holdings also raised its final dividend by 50% to USD0.15 from a year earlier, saying it intends to increase its usual interim dividend for subsequent first half results to USD0.075.

In 2023, it paid USD0.65 per share in dividends to shareholders, multiplied from USD0.15 in 2022.

"Lancashire delivered an outstanding performance in 2023. We continued to focus on writing profitable business in the best market conditions we have seen for a decade. Aligned to our belief in managing the market cycle, we have built a better balanced and more diverse underwriting portfolio over the past five years, which is generating more profit against our capital base. This has been one of our core strategic goals and will continue to be a focus going forwards," said Chief Executive Officer Alex Maloney.

"Lancashire is always led by the underwriting opportunity. We believe there are significant opportunities going into 2024 and we are well capitalised to be able to fund these through existing resources and internal earnings growth. In light of the excellent financial performance in 2023, we are returning the majority of our earnings to shareholders."

Shares in Lancashire Holdings were down 1.9% to 658.50 pence each in London on Wednesday morning.

By Greg Rosenvinge, Alliance News senior reporter

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