Juan Andrade
President & Chief Executive Officer at Everest Re Group
Thank you, Matt, and good morning, everyone. Thank you for joining us today. The current heightened and complex risk environment underscores the value of Everest's balance sheet and our commitment to support our customers with solutions vital to navigating this turbulent period. Everest diversification strategy and underwriting discipline mitigated our exposure to one of the largest hurricane losses in U.S. history. With our well-defined strategy, we are poised to take advantage of the hardening market, focused on segments with the best risk-adjusted returns. Both underwriting businesses, deliberate sub-90 attritional combined ratios and we are profitable on a year-to-date basis.
Led by top talent, we continue to grow and diversify globally by business and product. We are focused on executing our strategic plan as we built the company for the long-term. Our purpose is to provide protection and stability in the face of uncertainty. And as someone with routes and family in Florida, the devastation caused by Ian is heartbreaking and our thoughts are with all those affected. I am grateful to our colleagues around the world who are supporting our customers and communities as they rebuild. We have improved the company's risk profile across both reinsurance and insurance reducing our cat exposure with a more durable resilient portfolio, capable of absorbing a historic industry loss like Ian and containing it to an earnings event at just 1% of our estimated industry loss and with our reinsurance segment being below 1%.
We apply the same consistency and discipline to how we develop the overall portfolio, manage expenses, investor capital and expand operational efficiencies. In short, we're managing what is in our control and building flexibility into the business. Everest value proposition has never been more important to our clients and partners and we aren't committed as both insurers and reinsurers to being where we are needed.
Now, I will turn to the company's financial results. First from the group and then for each of the underwriting businesses. In the third quarter, we grew gross written premiums by over 6% in constant dollars. Growth was broadly diversified, led by continued double-digit growth in insurance. We continue to benefit from positive rate and increased exposure growth. We are ahead of loss trend and that is before the effect of all the deliberate portfolio management actions we are taking to improve margin. The combined ratio for the group was 112%, including the previously-announced pre-tax catastrophe losses, net of recoveries and reinstatement premiums of $730 million, primarily from Hurricane Ian.
It is important to note, Everest has additional hedging protection in place in the form of cat bonds. We did not include a cat bond recovery in our net loss estimate. However, recovery start if the PCS industry event for Ian exceeds $48 billion, Mark will provide additional details. Again the actions we took in both our businesses to reduce cat exposure have meaningfully benefited us. In reinsurance, we significantly scaled back our retro. Reduced participation in aggregate pro-business, shed cat exposed pro rata, and exposure to lower layers of cat programs, and achieved significant rate increases, higher attachment points and improved terms and conditions in the past several years.
Reinsurance gross and net PMLs have reduced significantly across the entire curve. And in insurance, we decreased gross PMLs for southeast wind by over 40% since last year. Gross exposed limits in our U.S. property portfolio are down more than 35% year-over-year. Put this in concrete terms, our share of the industry loss for Ian is lower than any other major land falling hurricane in more than 15 years, and we will continue to optimize our portfolio.
Turning to our underlying performance in the third quarter. The group attritional combined ratio improved to 87.6% year-over-year with improvements in both segments, and a new historic low for insurance. The group attritional loss ratio was strong in the quarter at 60.2% with a 70 basis point improvement from last year. This includes an outstanding 110 basis point improvement year-over-year in reinsurance. The group expense ratio in the quarter was stable at 5.5% and remains a competitive advantage. An elevated level of catastrophes during the third quarter resulted in a pre-tax underwriting loss of $367 million. Net investment income was $151 million, driven by stronger fixed income returns as new money yields continue to improve. As expected, this was partially offset by volatility in the equity markets.
On a year-to-date basis, we generated net investment income of $620 million, despite severe turbulence in all markets. Finally, operating cash-flow for the quarter was strong at $1.1 billion. We continue to execute our strategy despite the challenging environment evidenced by our year-to-date profitability.
Now turning to our reinsurance business. Reinsurance gross written premiums increased 3.4% over last year on a constant dollar basis excluding the impacts of reinstatement premiums. Growth was broadly diversified, led by 16% growth in our global casualty and professional lines book, but we are focused on key scenes or achieving strong underlying profit improvement with pricing outpacing loss trend. This was offset by targeted reductions in our property book, which was down 8% over prior year as part of our strategy to improve the diversification and economics of our overall portfolio.
We continue to benefit from a flight-to-quality and we grew with our core clients for affording us new and expanded opportunities across our portfolios. This strategy serves us well. We bring clients a strong balance sheet, flexibility and expertise. Allowing us to target higher margin opportunities in all lines of business and geographies. This is a key advantage of broad diversification. Combined ratio of 115 was driven by the previously announced pre-tax catastrophe losses, net of recoveries and reinstatement premiums of $620 million from Hurricane Ian, as well as the European hail storms, hurricane Fiona and Typhoon Nanmadol.
Year-to-date reinsurance generated 14 million in underwriting profit. Our attritional combined ratio of 86.8% improved 30 basis points from the prior year, including a year-over-year attritional loss ratio improvement of 110 basis points to 59.1%. Our attritional loss picks reflect our deliberate actions to improve the portfolio's risk-adjusted profitability. We continue to see improving loss ratios, while the pressure for increased commissions is easing. Everest is well positioned to benefit from the underlying rate increases and improving terms and conditions in the market post Ian.
Events from the year will affect the January 1 renewal in a variety of ways. In North America we expect the property market to be dislocated, particularly in property cat due to recent losses combined with economic inflation, increasing demand and a meaningful contraction of capacity. Underlying casualty pricing should remain strong. Internationally, there are nuances depending on class and region and we will flex accordingly. We are well positioned with the balance sheet capabilities and relationships to capitalize on the momentum fueling improved economics across property and casualty in a targeted and disciplined manner.
Because of the balance between property and casualty in our book we have the ability to dynamically deploy capital both across line and geography and can remain nimble and opportunistic as market conditions warrant, always within our defined risk appetite framework. Jim Williamson is available to provide additional details during the Q&A.
Turning to our insurance business where we continue to achieve double-digit growth with sustained margin expansion. Growth in insurance was strong. We achieved a new third quarter premium record for this segment with over $1.1 billion of gross written premium, up 13% in constant dollars. Growth was broad and diversified across most lines and regions and were especially strong in U.S. casualty. Excluding D&O and transactional liability where the macroenvironment, a slowdown in M&A activity, IPOs, etc, has had an impact on deal flow, our growth was 20%. This is a testament to our underwriting discipline as we focus on trades meeting our underwriting return objectives.
We are benefiting from additional premium on many inflation sensitive lines, particularly in property, general liability and workers compensation. We continued to exceed loss trend. Renewal rate and exposure ranged from high single digits to double digits for the quarter, depending on line and geography excluding workers compensation, which is now a small part of our portfolio. In addition, both earned and new business rates meaningfully exceed renewal rate changes. The new business rate level bodes well for continued margin expansion as these policies renew and loss to more normalized levels in the future.
Increasing rates are important but risk selection, improving terms and conditions limits management and growth in inflation sensitive exposures also contribute meaningfully to sustaining and increasing margins. Insurance growth was partially offset by continued actions to optimize the portfolio including reductions in U.S. property catastrophe exposure. The impact of natural catastrophes primarily Hurricane Ian led to $110 million pre-tax catastrophe loss net of recoveries and reinstatement premiums in the quarter and resulted in a combined ratio of 103.5%.
As I mentioned earlier, underwriting actions to diversify our property portfolio, made a significant difference in our results. We will continue to hone our portfolio to manage volatility. This discipline is reflected in our year-to-date underwriting profit of $95 million and it is indicative of our progress in portfolio composition. The insurance division's third quarter attritional combined ratio of 89.8% is the best in its history and a 50 basis-point improvement from the third quarter last year. The attritional loss ratio for the quarter was 63.2, up slightly compared to Q3 2021, driven predominantly by business mix relative to last year. The year-to-date attritional loss ratio which is less affected by timing and business mix improved by almost a full point over last year. We continue to diversify internationally with progress in Europe, Latin America and Asia.
We recently opened two new Everest Insurance operations in France and in Germany in addition to our operations in the Netherlands, Chile and Singapore. Our success continues to be powered by investments in great talent, and we continue to fuel our growth with sophisticated data, analytics and systems that support streamlined and best-in-class service across the organization. Michael Karmilowicz is on the call to provide more detail during the Q&A.
Our discipline and seamless execution are essential to performing in today's environment. We are targeted in our approach. We're highly diversified by geography, business lines, product and in our people. We have a cultural advantage in how we manage the company. We view this as essential to cultivating excellence in our business and we are proud to have been recently recognized as an industry leader in this area. I am very optimistic about Everest stability to deliver superior value to our shareholders, clients and colleagues.
Now. I will turn the call over to Mark to take us through the financials in more detail. Mark?