Motor insurers made combined €273m loss in Ireland last year

Motor insurers in Ireland made an aggregate underwriting loss of €273 million last year, according to data published by the Central Bank of Ireland. These losses were 38 per cent higher than in the previous year.

Investment income of €51.8 million last year left them with a total loss of just under €222 million for 2015. This compared with a total loss in the previous year of €123 million.

The biggest loss recorded was by Irish-owned FBD, which posted an underwriting deficit of €101.7 million. The company recorded investment income of €9 million to leave it with a total loss on its motor book of €93 million.

Axa and Allianz both recorded underwriting losses in excess of €40 million, while British insurer RSA had a deficit of just under €26 million.

Liberty Insurance, the US group that acquired the former Quinn Insurance business, and Zurich both made underwriting losses of close to €17 million.

Some 13 insurance providers, who had their head office in Ireland last year and were supervised for solvency purposes here, racked up combined losses of €253.7 million.

Aggregate losses

Another eight, who have their head offices in other European Union member states, had aggregate losses of €19.7 million. The biggest underwriting deficit recorded by this cohort was by AIG Europe Ltd at €26.2 million.

By contrast, Aviva Ireland, a branch of the UK insurer, made an underwriting profit of €5.7 million. Investment income of €14.7 million gave it a surplus for the year of €20.5 million.

Irish Public Bodies, which mostly insures State and public sector entities, made an underwriting surplus of €2.8 million. When combined with investment income of more than €1.3 million, the overall surplus on its motor book was just under €4.2 million.

IPB had retained profits of €33.7 million last year across its entire book, paying a dividend of €15 million.

Total claims

Total income earned by the insurers during the year amounted to €951 million, while the total claims were just more than €1 billion. These figures exclude operational costs and other expenses.

Motor insurance costs have rocketed in Ireland in the past couple of years – Central Statistic Office data put annual inflation at 28.2 per cent in August – with insurers blaming an increase in the number of claims lodged, inflated court awards, high legal costs, and reduced investment income for the increased premium costs.

The data published by the Central Bank shows that Allianz, which insures a wide range of risks, paid a dividend to shareholders last year of €10 million in spite of recording a loss of just under €14 million for 2015.

Liberty’s total loss for the year was €63 million while RSA’s deficit is listed at €39 million.

The Central Bank's data shows a dividend payment for Irish Life Health of €12.6 million and retained profits of €1.8 million. Irish Life Health was formed recently by the merger of GloHealth with Aviva's health insurance business here under the ownership of Irish Life.

State-owned rival VHI is listed as having retained profits last year of €20.4 million.