Company: AHL
Filing Date: 2025-03-20
Form Type: F-1/A
Source: 0001628280-25-014149
Chunk: 167

Company: ASPEN INSURANCE HOLDINGS LTD
Filing Date: 2025-03-20
Form: F-1/A
Chunk 167
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, 2023, contributed adverse development of 1.2 percentage points towards the overall loss ratio.

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Table of C ontents

Adjusted losses and loss adjustment expenses. The adjusted losses and loss adjustment expenses relate to the post-LPT accident years and exclude the change in deferred gain associated with retroactive reinsurance contracts. Adjusted losses and loss adjustment expenses represents the performance of our business for accident years 2020 onwards, which we believe reflects the underlying underwriting performance of the ongoing portfolio. Refer to Note 2 of our audited consolidated financial statements, “Basis of Presentation and Significant Accounting Policies” for additional details of the retroactive reinsurance contracts. The adjusted losses and loss adjustment expenses is the basis on which we report adjusted underwriting income and adjusted combined ratio, as well as the basis in which underwriting income contributes to operating income. Refer to “—Key Performance Measures and Non-GAAP Financial Measures” for further details.

Impact of the LPT. The impact of the LPT includes the impact of prior year reserve development on 2019 and prior accident years, net of the change in the deferred gain recognized in relation to retroactive reinsurance contracts which is primarily driven by the LPT, totaling $35.0 million.

2023 compared to 2022

The overall loss ratio for 2023 of 59.4% improved by 3.1 percentage points compared to 2022, and losses and loss adjustment expenses decreased from $1,680.0 million in 2022 to $1,553.0 million in 2023. This was mainly due to the following:

Current accident year losses, excluding the impact of catastrophe losses. Current accident year losses, excluding the impact of catastrophe losses, contributed $1,372.1 million, or 52.5 percentage points, for 2023 compared to $1,345.1 million, or 50.0 percentage points, for 2022. The increase in the current accident year loss ratio, excluding the impact of catastrophe losses, was primarily due to an increase in the claims handling provision and higher initial loss estimates to account for uncertainty in relation to the potential impact of social and economic inflation. While social inflation is not a new influence, general economic inflation has been elevated in recent years, and there is uncertainty as to whether this will continue. Various factors such as behavioral and political elements, arising from changing views of the general public, as well as institutional and legislative developments from court rulings,