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LONDON (Alliance News) - Ireland's FBD Holdings PLC Tuesday reported a significant drop in pretax profit as the already competitive Irish insurance market experienced severe weather and an increase in car insurance claims frequency, arising from a sharper-than-expected increase in Irish economic activity.
In a statement, the property and casualty insurer said it made a EUR3.3 million pretax profit in the first-half of 2014, compared with EUR19.1 million in the corresponding period last year.
The cost of severe and persistent weather in the period was EUR44.3 million, gross of reinsurance, and EUR15.3 million, net of reinsurance.
FBD also said that premiums in the Irish insurance market stabilised during the period following eleven consecutive years of decline.
"While the market remains very competitive, rates have continued to harden for both car insurance and business insurance," FBD said in a statement.
FBD increased gross written premium by 5.1% to EUR184.9 million. Average premiums increased by 3.1% and policy volume increased by 2.0%.
FBD increased its interim dividend to 17.0 cent per share from 15.75 cent per share.
In June, FBD was forced to cut its guidance for the full-year 2014 operating earnings per share to a range of between 70 and 80 euro cents. It reiterated that guidance Tuesday, so long as no further exceptional weather events arise.
FBD shares were Tuesday quoted down 0.7% at EUR14.165.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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