The Swedish Club has reported a pre-tax $3.4m loss in the first half of this year in the first set of results to reflect the impact of the pandemic on mutual marine insurers.

The Gothenburg-based mutual, which operates in both the marine insurance and protection and indemnity markets, said that it had recovered much of the investment loss that occurred in the first few months of the year when the equity markets crashed because of the pandemic.

The Swedish Club realised a 0.5% investment gain in the six month period, but its free reserves fell slightly from the 2019 historic high of $228m to $225m.

The insurer said its financial position remained “strong”.

In pure underwriting terms, the Swedish Club also operated at a loss. Its combined ratio, which reflects the balance of premium income and claims and expenses, was 107% indicating a deficit. The Swedish Club said that the underwriting performance was “in line with expectations” and attributed the shortfall to a few large claims.

In a more positive development, premium income increased by 18% which was prompted partly by a 5% increase in premiums at the last renewal.

The Swedish Club said that it expected hardening rates to help improve its underwriting performance.

“A strengthening of market pricing will most likely be a positive contributor to improved balance going forward,” the Swedish Club said.

Swedish Club managing director Lars Rhodin took the positives from the result.

“These exceptional circumstances have given us all time to consider – to reflect on what we do and what we are able to deliver. The half year results have demonstrated that we will come out of this situation as a more efficient organisation," he said.

He pointed to the mutual’s recently launched digital Trade Enabling Loss Prevention (TELP) system as a new service that has helped its members deal with the some of the trading problems caused by the pandemic.