Written Premiums

During 2020, written premiums increased 24.5%, from Ps. 8,214 million in 2019 to Ps. 20,226 million, largely driven by Reaseguradora Patria’s performance, underpinned by its strategy aimed at gaining market participation where it operates. On the other hand, written premiums by General de Seguros in 2020 remained roughly in line with 2019.

Net Increase of Unearned Premiums Reserve

The Company’s unearned premiums reserve rose 28.1% in 2020, from Ps. 326 million in 2019 to Ps. 418 million..

Net Acquisition Cost

2020 Net Acquisition Cost increased 27.9%, amounting to Ps. 2,313 million vs. Ps. 1,808 million in 2019, mainly due to an increase of Ps. 401 million in reinsurance commissions and an increase of Ps. 120 million in stop-loss coverage expenses to safeguard the Company’s retention. Net acquisition cost as a percentage of net written premiums was 28.3% in 2020, compared to 27.3% in 2019.

Net Claims Cost

Net Claims Cost climbed 21.0% in 2020, from Ps. 3,757 million in 2019 to Ps. 4,545 million, derived from increased claims at Reaseguradora Patria (+Ps. 1,005 million). In 2020, net claims cost as a percentage of net premiums earned was 58.7% vs. 59.6% in 2019.

Technical Result

During 2020, the Company's technical income totaled Ps. 886 million, increasing 19.2% over the Ps. 743 million posted in 2019, supported by the surge in written premiums , which offset higher acquisition and claims costs.

Other Technical Reserves

Other technical reserves (mostly catastrophe reserves) increased Ps. 941 million in 2020, up 40.9% from Ps. 668 million in 2019, explained by the Ps. 935 million rise in catastrophe reserve at Reaseguradora Patria.

Operating Expenses

2020 operating expenses increased slightly by 0.5%, from Ps. 907 million in 2019 to Ps. 912 million, mainly due to an increase of Ps. 68 million in administrative and operating expenses. Excluding the extraordinary effect with regard to the Company’s profit-sharing plan and the timely accounting of the monthly statements related to the reinsurance taken, operating expenses decreased 1.3%, totaling Ps. 868 million vs. Ps. 879 million in 2019, given the investments made for the development of an ERP system and the Company's digital and organizational transformation.

Comprehensive Financing Result

Reflecting the effects of the pandemic on equity markets and lower interest rates, the Company’s Comprehensive Financing Result amounted to Ps. 750 million in 2020, 42.4% lower compared to Ps. 1,301 million in 2019.

Net Result

In 2020, the Company recorded a Ps. 196 million net loss vs. a Ps. 326 net income in 2019, as the higher written premiums were not enough to completely offset the negative impact of the pandemic on the stock market performance of the Company's portfolio during 1Q20.