Juan C. Andrade
President and Chief Executive Officer at Everest Re Group
Thank you, Matt. Good morning, everyone. Thank you for joining us. Everest's excellent fourth quarter performance capped another strong year of consistent execution of our strategy and continued positive momentum. We advanced our objective of creating sustainable value for our shareholders with disciplined underwriting and targeted growth, driving margin expansion in both businesses.
We increased diversification in each of our segments both geographically and by product line. When you combine all of this with healthy and consistent rate increases and improved terms, our risk-adjusted return profile improved across the board. Both franchises delivered solid top and bottom line performance. We profitably grew our Primary Insurance division and executed an outstanding January 1 reinsurance renewal. This further reinforced our global market leadership and positions Everest well for the future.
Our actions resulted in solid underwriting profit for the year, over $1 billion in operating income and a double-digit operating return on equity for both the quarter and the year, an excellent result. We achieved these results despite market volatility, economic and geopolitical uncertainty, and industry catastrophe losses totaling over $140 billion in the fifth costliest cat year in history.
In short, we accomplished a great deal in 2022 and built a wide runway for future opportunity. We are uniquely positioned with accelerating momentum and top tier talent driving this business. Everest is more agile and well-equipped than ever, and we have the ability and the drive to seize attractive opportunities and deliver on our commitments in 2023.
Now, I will briefly recap our financial highlights, focused on the full year, beginning at the Group level. In 2022, we grew the Company by 9% in constant dollars, ending the year at approximately $14 billion in gross written premium. We generated $477 million in underwriting profit with a 96% combined ratio. This is a near 2 points improvement year-over-year despite an active cat year. The attritional combined ratio of 87.4% also improved from the end of 2021, and we achieved a 70 basis point improvement year-over-year in the Group loss ratio. The operating expense ratio remains best-in-class at 5.8%.
Finally, our high-quality investment portfolio generated $830 million in net investment income. Our actions to optimize the investment portfolio over the past three years and position it for a rising rate environment have paid significant dividends.
Now, turning to our underwriting segments, beginning with Reinsurance. Our Reinsurance division's focused execution in 2022 further enhanced our global market leadership and preferred partner position. We continue to optimize our portfolio, while achieving solid top and bottom line growth. For the full year, Reinsurance growth was 5% on a constant dollar basis with $9.3 billion in total gross written premiums. This growth was driven by broadened opportunities with our core cedents and our nimble allocation of capital to achieve the highest returns.
We took deliberate actions during 2022 to shed underperforming business. This also positioned us well to take advantage of the strong trading conditions at January 1. These actions resulted in over $300 million in underwriting profit for the year and a combined ratio of 96.4%. It's a 1.7 point improvement from '21. For the full year, both the attritional loss ratio at 58.7% and the attritional combined ratio at 86.2% improved, down 90 basis points and 10 basis points, respectively. Our deliberate underwriting actions significantly reduced our cat losses, demonstrated by our less than 1% market share from Hurricane Ian in the third quarter, the second largest hurricane in US history.
Our focus Reinsurance strategy continues to pay dividends. Throughout 2022, we leveraged our market position, deep client and broker relationships, and strong balance sheet to build a more profitable and higher margin book, which culminated in an outstanding January 1 renewal. I'll provide more color on 1/1 in a few minutes.
Now, turning to our Primary Insurance division, in 2022, we made tremendous strides expanding our reach, capabilities, product set and breadth of global talent, while hitting important financial milestones. We finished the year with insurance growth of 18% in constant dollars and $4.6 billion in premiums. This is supported by new quarterly gross written premium record in the fourth quarter. Growth was balanced and diversified across the business by product line and by geography.
After four years of significant and cumulative rate increases, we achieved high-single digit average increases, excluding workers' compensation, throughout the year.
In addition to rate, exposure growth, driven by revenue and payroll increases, created additional margin against loss trend. Pricing increases in the quarter were led by commercial auto, general liability and property. Our proactive cycle management actions contributed to our continued improved underwriting profitability. Our ability to pivot quickly is a key advantage. Everest continues to benefit from an influx of top talent with the market expertise, track record, underwriting acumen and relationships to execute our strategy.
We achieved a milestone full-year underwriting profit of $164 million, which is a new annual record for the Insurance division with a full year combined ratio of 94.8%, down 2.3 points year-over-year. Our attritional combined ratio also improved 80 basis points year-over-year to 90.4%. We are enhancing our operations to become even more connected and efficient on a global scale. It's an exciting time for our primary business. We continue to see significant opportunities, and I look forward to even greater momentum ahead.
2022 was a year of multiple wins. We reduced volatility, diversified the portfolio, expanded margins and enhanced our risk adjusted return. We got there with consistent and precise execution. We deployed our capital in areas where we could get the best risk-adjusted returns. We also reshaped our property portfolio through continued diversification via growth internationally, all this accomplished while increasing our top and bottom lines. And we improved net exposure to our balance sheet. As I mentioned before, we remain risk-on for property cat as pricing, terms and conditions provide attractive returns within our defined trading range.
Turning to 2023, the January 1 reinsurance renewals were executed by our global reinsurance team with equal precision, and as a result, we have a significantly stronger portfolio heading into 2023 and beyond. We approached the January 1 renewals from a position of strength with a superior value proposition, well-prepared to support our clients, and taking advantage of excellent market conditions around the world. We set clear goals for our portfolio, and we achieved every one of them by leveraging Everest's global market leadership and setting early expectations with clients and brokers, which drove significant pricing improvements.
In addition to rate, we also substantially improved terms and conditions. We targeted attractive property opportunities, both domestically and internationally, at materially improved risk-adjusted returns. We drove higher attachment points [Phonetic] and reduced exposure to named and secondary perils.
Significant property cat rate increases were evident across all geographies. In North America, the property cat XOL risk-adjusted rate change was up approximately 50%. The average attachment point for our global property cat business also increased meaningfully, resulting in significantly reduced risk exposure. At the same time, the expected return for our cat portfolio increased materially. In casualty and professional lines, pricing and terms and conditions continued to improve overall, and we leveraged the hard property market to strengthen and further diversify the portfolio.
Internationally, the 1/1 renewal exceeded our expectations throughout Europe and Asia. We grew our regional portfolios through increased participations and by expanding our base of new clients. We also saw significant rate movement in specialty lines exposed to the Russia-Ukraine war, particularly in marine, aviation and political violence.
I am very pleased with the performance of our outstanding Reinsurance team. Everest distinguished itself in this renewal by our early and consistent communication with our brokers and clients. We set expectations heading into 1/1 and constructively worked with them to find solutions. As a result, we improved our portfolio and expanded margins, while deepening our relationships with brokers and clients.
Looking forward to future 2023 renewals, we expect reinsurance pricing momentum to continue. We see abundant opportunity to continue growing and diversifying our portfolio in all markets, focused on further growth in Asia and Europe, while capitalizing on the continuing market dislocation in property. Given significant firming of the reinsurance market on January 1 and the heightened risk environment, primary insurers should also see firming prices in 2023. They will need to maintain underwriting discipline.
I am proud of what Everest achieved in '22. We delivered on our strategic objectives, while laying the groundwork for sustained profitable growth. I attribute Everest's success to our outstanding team and their consistent and relentless execution in every aspect of the business. The outlook for 2023 is bright, and I look forward to taking this company to the next level.
Now, I will turn the call over to Mark to take us through the numbers in more detail.