Good morning, everyone. Thank you for dialing into our Q1 IMS. It's only been a few weeks since we did our year-end call, so this is going to be relatively brief, as there's not much new to say. So I'll give a few highlights, and we'll go into some Q&A if there is any. The guidance that we gave for 2024 was for growth in the high single digits, rate change in the low single digits, an undiscounted combined ratio in the early 80s, and a yield on our fixed income investments of just under 5%. And that is pretty much what we have achieved in the first quarter, gross growth of 7%. There are some nuances on an individual division basis, and this being the first quarter, some divisions' outcomes are not what we're planning or expecting for the full year.
Net growth is a little higher at 11%, as we have completed the last step, really, of reducing our quota share reinsurance spend back to where it was pre-2020. Nothing has happened from a claims perspective that would mean either we would update on a specific event or update our combined ratio guidance. Our investment performance in Q1 was 1.2% or $126 million, roughly on target, but the yield on the fixed income book has increased a little to 5.1% at the end of March. So going into the divisions in a little more detail, on cyber risks, last year in the first quarter, cyber grew by 24%. This performance, as we mentioned, was flattered by late premium recognition from previous years, particularly 2022, meaning premium patterns were skewed in Q1 last year.
Additionally, in the first quarter of this year, we wrote a reasonable amount of partnership business, which is not immediately recognized in premium terms. Just to note, this isn't us giving away our pen. This is us working with distribution partners around the world, particularly where we don't have a footprint, using our forms, our services, and so on and so forth. This feature of later premium recognition will unwind during the year. And when you strip these factors out, the underlying performance in cyber is for moderate growth, which is what we expect by the year end. We continue to be focused in Europe. Although we are seeing a little bit more competition here, it doesn't alter our view for the year and beyond for cyber business and our overall 2024 guidance.
On MAP then, as we mentioned in the press release, part of the process of moving our North American business away from the Lloyd's platform has resulted to change to where we utilize third-party capital, with our main third-party syndicate writing more of our London, Singapore, and Miami business. This has impacted the group numbers for MAP, which is why you see a flat performance on a group level. Gross of that increased session, MAP has actually grown by just over 10% year to date. With growing geopolitical uncertainty, combined with better economic prospects, demand for our products within MAP remains strong, and we are confident in the continuing growth prospects for that team. On property risks, as with MAP, property is also affected by the change in where we utilize third-party capital.
But to the corollary, there's an increase in the amount of premium that we are retaining here. We continue to see good opportunities. As we've been saying for some time, this business is becoming more complex, and therefore, business continues to move from the U.S. admitted market into the E&S market, which is where we underwrite. Whilst we're not expecting the same level of growth we saw last year, we expect to see further opportunities this year, and we are still getting positive rate change, particularly on our North American platform. Lastly, with specialty, we continue in the same vein as last year, navigating the more challenging conditions in the D&O market, whilst growing in other smaller niche areas that have lower exposure to social inflation.
For example, outside the US, in our environmental portfolio, our white labeling business, and so on and so forth. We expect very moderate growth for the year in this division, unless there's a significant change in the risk reward dynamics for D&O. And lastly, I thought I'd give an update on the progress of our share buyback program. We've bought just under GBP 60 million of shares, or about 9 million of them, and continue and we anticipate to complete the GBP 325 million program in Q4 this year. And with that, I will open up to Q&A.
Thank you. Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We'll now take our first question from Kamran Hossain of J.P. Morgan. Your line is open. Please go ahead.
Hey, good morning, Adrian. Just the first question is just around, I guess, the claims experience in the quarter. As you said, nothing really to call out. Within the low eighties combined ratio guidance you gave for the year on an undiscounted basis, you had said that you expect frequency to come back to, kind of, you know, pre-2023 levels. Can you maybe update us on kind of what you're seeing, and whether, you know, it has gone back or kind of any updates on that? The second question is just around top-line growth. I think, you know, the cyber piece is clear. We obviously expect to get back to kind of moderate growth in the year. Property seems to have had, like, you know, an exceptionally strong start to the year again. How do you see that working?
Do you think property continues like that for the rest of the year? I know you've kind of talked about the opportunity there, you know, a couple of times in the last few months, so just interested in your thoughts on that. Thank you.
Thank you, Kam. Good morning. Claims experience, so far this year has continued to trend from last year, really. It is early, so, you know, it's far too early to draw any conclusions for the year, but we haven't seen a marked change in claims activity. On the property side, you know, as I mentioned, the growth to the group's been flattered a bit because we're keeping more of that business. Having said that, you know, whilst we have seen more capacity come into the market this year, you know, the macro story about business moving from the admitted market to the E&S market persists, and so we do expect to be able to continue to grow strongly.
We'll have a pretty good view of the whole year at the half year, because a lot of U.S. property business, you know, is written in the first half of the year. So we'll have more information in a couple of months' time, but I don't see the opportunity diminishing. No.
Thanks, Adrian.
Thanks, [unaudible].
Thank you. We'll now move on to our next question from Tryfon Spyrou with Berenberg. Your line is open. Please go ahead.
Oh, oh, hi there. Hi. Hey, Adrian. I just had a question on the gross versus net growth. It looks like the net sort of is running somewhat higher than what you previously sort of guided us. I was just wondering if there could be any sort of changes to your... Obviously, you mentioned that you completed the last step of your reinsurance quota share, pulling that back. But is there anything that you should be expecting that to run higher for the remainder of the year as well, or should that come back as you go through the year? That was my first question. The second one is on the overall dynamics in the E&S market.
I appreciate your comments earlier that you're seeing strong flow of business, but is there any sort of view on when the equilibrium could be reached between the E&S market? And with that regard, how does pricing look like on property and casualty lines within that E&S market at the moment? Thank you.
Great stuff. Thanks, Trif. Let's do the gross versus net question first. So yes, we've bought a little less quota share reinsurance this year. I don't expect us to continue to reduce reinsurance going forward, but that gross versus net differential will probably persist through the rest of the year. Yes. As far as the E&S market is concerned, when do we expect it to reach equilibrium? I'm not sure. You know, there are some... Again, there are some big macro issues at play here. You know, you know, as we've talked about, as you mentioned, property insurers are having to deal with inflation, exposure growth, and climate change, which is a complex set of issues. It's difficult to deal with those within the confines of the admitted market.
And that's not going to go away. And so I think business will continue to move across to the E&S market, where insurers can underwrite with more freedom and flexibility. You know, we are beginning to see some of the state regulators try to tackle some of those issues in order to allow more business to stay in the admitted market, but I think that will take some time. We have an E&S insurance company and an admitted insurance company in the U.S., so if the admitted environment does become better to write property business in and business flows back in, we'll be able to do that there, too. So, we're well equipped either way, but the fundamental issue is that property is getting more complicated again, and that suits us specialty area.
Great. Thank you.
Thank you very much indeed.
Thank you. We'll now take our next question from Nick Johnson, of Numis. Your line is open. Please go ahead.
Thank you very much. Can you hear me, Adrian? Morning.
Morning, Nick. How are you?
Good, thank you. Couple of questions, please. Firstly, on specialty growth, 6%. You've achieved that without particularly significant or material price increases. Just wondering what gives you the confidence to be pushing for growth in that segment right now? Appreciate it's obviously a very broad church of products, but a bit more color in terms of what's giving you confidence to grow that part of the business. And secondly, it's a few months... well, it's a few weeks or months on from the full year-
Mm-hmm
... 2023 results season.
Mm-hmm
... and the whole industry reported very strong combined ratios. Just wondering how that's landing with clients when you're discussing pricing at renewals recently? Thanks.
Thank you, Nick. Okay, growth, especially without significant rate change. You know, I alluded to this earlier. So we are continuing to de-risk the D&O business. We've been bearish on the bits of business we've got within the specialty book that have exposure, real exposure, to social inflation. You know, we don't write very much occurrence business at all, and that's really taken the brunt of the social inflation, you know, GL, excess casualty, umbrella, auto, that sort of thing. But we do have bits and pieces where there's mostly high exposure to bodily injury, where there is some within our healthcare book or our employment practices book. But there's plenty of business that we write that isn't D&O and isn't exposed to social inflation, and that's where we've been growing.
And I called out, you know, our M&A business, or our environmental business, some of our business outside North America, our white labeling business, all that, and some of the specialty casualty that we do. And there's plenty of opportunity there. So that's where the growth has come from, and I'm very pleased that the team have managed to pivot so well. How have the clients been taking the combined ratios? I think we've managed to have the conversation that, you know, the insurance industry's been dealing with a number of issues over the last five years. It hasn't really met the cost of capital for the past five years, which is why we've been doing so much remediating as an industry.
We're in volatile times and, you know, I think the results last year reflect both a better underwriting environment generally and the fact that, for us at least, you know, we had less than expected catastrophes, and I think most clients are comfortable with that.
Super. Thanks very much.
Thanks, Nick. Well, thank you very much indeed for dialing in. Thank you for the questions as they were, and we'll talk to you at the half year. Thank you very much indeed. Please contact Sarah Booth with any further questions, and we'll get back to you as soon as we can. Thank you.