Markel Corp’s 2017 first quarter slumped in a major way, with a drop in net income and a rise in its overall combined ratio. The holding company for insurance, reinsurance and global investment operations blamed a decrease in the Ogden rate for much of the disappointing results.

The Ogden rate is used to calculate lump sum awards in UK bodily injury cases. The UK recently cut the rate from 2.5 percent to -0.75 percent, and that will spike what insurers must pay claimants. Carriers such as AXIS Capital Holdings have also blamed the Ogden rate change for dampening its results.

Markel booked more than $68.9 million in net income during Q1, or $3.90 in diluted net income per share. In the 2016 first quarter, Markel pulled in $160.37 million in net income, or $11.5 in diluted net income per share.

Markel’s combined ratio came in at 100, compared to 88 in the 2016 first quarter.

Alan Kirshner, Markel’s executive chairman, said that aside from the Ogden rate issue, financial results were solid.

“Our results for the first quarter were adversely impacted by the decrease in the Ogden rate,” Kirshner said in prepared remarks. “Otherwise, our underwriting results were in line with our expectations. Returns on our investment portfolio drove growth in book value for the quarter and we continued to see positive contributions from our Markel Ventures operations.”

Kirshner added that longer term, Markel will stay focused on “exercising underwriting discipline and will only write business that supports our underwriting profit targets.”

Here are highlights of Markel’s consolidated results:

• Net earned premiums reached $982.6 million, versus $957.7 million in the 2016 first quarter.

• Net investment income surpassed $100.3 million in Q1 2017, compared to $91.3 million over the same period last year.

• Markel’s US Insurance arm achieved a 93 combined ratio in Q1. Its international insurance arm had a healthy 88 combined ratio. The company’s reinsurance division booked a 132 combined ratio.

• Markel’s gross written premium volume, by division, was $639.8 million for U.S. Insurance, $273.17 million for International Insurance and $547.7 million for Reinsurance in the 2017 first quarter. For the 2016 first quarter, those numbers were $647.8 million, $291.4 million and $453.5 million, respectively, for U.S. Insurance, International Insurance and Reinsurance.

• 2017 first quarter net written premiums were $545.1 million, $225.4 million and $489.6 million, respectively. for U.S. Insurance, International Insurance and Reinsurance. Those same numbers in the 2016 first quarter were $552.7 million, $226.4 million and $402.7 million, respectively.

Source: Markel