Hurricane Katrina's impact on Irish insurers and policyholders is expected to become clear in the coming weeks as reinsurance companies revise their estimated losses, the Irish Insurance Federation (IIF) said yesterday.
Michael Horan, the IIF's non-life insurance manager, said it was too early to calculate if Hurricane Katrina would have any knock-on effects on the premiums Irish consumers pay.
"They are still quantifying the losses and the estimates are varying quite a bit. They haven't had a chance to inspect the damage in any real way yet and we don't know which reinsurance companies are carrying the highest exposure," Mr Horan said.
The IIF yesterday released its Factfile for 2004 showing that the overall value of insurance premiums paid by Irish consumers fell slightly last year to €11,863 million, down €20 million on the 2003 figure.
As a proportion of GDP, the value of premiums paid was 8 per cent in 2004, down from 10 per cent in 2000. The IIF said this was largely a result of falling non-life rates.
Non-life gross written premiums were €3,934 million, down 7.2 per cent on 2003. This bucked the trend in other pre-enlargement EU states, where as a whole the market grew by 3.7 per cent.
However, non-life insurers' underwriting profits soared from €417 million to €673 million, an increase of over 60 per cent.
In the motor insurance sector alone, gross written premiums fell 10 per cent, but as a result of a 14.4 per cent reduction in net claims costs, insurers' net underwriting profits increased by 58 per cent to €322 million.
The combined operating profit after investment income of the 24 companies in the non-life market was €1,056 million, up from €757 million in 2003.
Life assurance and pensions gross premium income was almost €7,930 million last year, an increase of 3.7 per cent on the previous year.
New annual premium life assurance business was up 13 per cent to €808.2 million, while new single premium business grew 4 per cent to €3,957 million.
Overall, new business in the life assurance sector when measured by annual premium equivalent (annual premium sales added to 10 per cent of single premium sales) increased by 10 per cent to €1,204 million.
IIF chief executive Mike Kemp said the 2004 results were positive developments for consumers and shareholders.
Insurers profits in the non-life sector were a result of Government reforms, which have led to a reduction in claims costs, Mr Kemp said. This was reflected in significant reductions in motor and commercial insurance rates for policyholders, he added.
"Motor premiums are now at 1999 levels. While the rate of serious and fatal road accidents remains high, the impact of the reforms in terms of the claims cost environment has been beneficial for consumers and insurers."
Insurance company investments rose in value by 21.7 per cent in 2004 and stood at €66 billion at the end of the year.
