THE €65 MILLION acquisition of 123.iein July 2010 appears to be paying off for British insurer RSA, judging by its half-year results this week.

RSA Ireland wasn’t commenting on the results but the statement issued by its parent company certainly sought to project the business here in a positive light.

"In Ireland, our aim is to drive value from the acquisition of 123.ieand maintain our market leading profitability and we are delivering on both objectives," RSA stated boldly yesterday. With the overall market believed to have contracted by about 6 per cent, RSA's premiums of £183 million were down by 2 per cent when translated into sterling but up by 3 per cent in euro terms.

RSA said growth was driven by 123.ie, which increased premiums by 20 per cent and is "performing well ahead of the original business case".

The Irish underwriting result was £14 million in the six-month period compared with £21 million for first half of 2011.

This was despite the June floods, for which the net impact was about £6 million.

RSA described its combined operating ratio in Ireland as “an excellent 92.6 per cent”.

In terms of the outlook, RSA said Ireland "continues to deliver market-leading profitability with 123.ieperforming well ahead of expectations".

RSA also gave an update on its exposure to government bonds in Ireland, Greece, Portugal, Italy and Spain.

At the end of June, the total stood at £144 million or about 1 per cent of its total portfolio.

Of this, £71 million is in Ireland and £51 million in Italy. It holds just £400,000 worth of Greek government debt, which says something in itself.

“We have very limited exposure to bank debt in all of the peripheral European countries, with holdings totalling just £60 million at 30 June 2012,” the insurer added.

This sounds like a prudent policy in the current climate.