Profits at Hibernian rose by 21 per cent during the first half of 2005, according to interim figures released by the insurance company yesterday.
Group operating profit over the first six months of the year was €150 million, up from €123.7 million over the first half of 2004.
However, income from general insurance premiums fell 12.4 per cent from €450 million in the first six months of last year to €394 million in the same period this year. Despite this drop in premium income, operating profits for general insurance increased from €100 million to €120.3 million.
Hibernian Group chief executive Bryan Jenkins said the "strong" result for general insurance reflected a combination of disciplined underwriting and lower claims costs.
Many customers have now seen their motor insurance premiums return to 1999 levels, Mr Jenkins said.
New life assurance and pensions business rose 16 per cent on the same period last year from €64.1 million to €74.2 million. This figure is measured by annual premium equivalent, or 10 per cent of the value of new single premium sales added to the value of regular premium sales. Mr Jenkins said market competitiveness in the life and pensions business had kept margins down. He attributed growth to strong single premium pensions sales.
Hibernian is moving to reporting life and pensions results on a European embedded value basis. By this measure, operating profits for life and pensions rose by 28 per cent from €23.1 million to €29.7 million.
The value of Hibernian's investment management business increased from €8.1 billion to almost €9.5 billion. The growth was buoyed by the company's Guaranteed Fund.
Hibernian is the largest general insurer in the Republic and the third largest life and pensions provider. It is owned by Britain's largest insurer Aviva, which hit the top end of expectations with a 21 per cent rise in first-half profit, but its weak outlook for UK life insurance margins sent its shares, and those of rivals, into the red.
Aviva said yesterday that operating profit in the six months to June 30th was £1.32 billion, fuelled by an 18 per cent increase in earnings in its general insurance operations to £694 million and strong life and pension sales in mainland Europe.
