Axa Insurance in Ireland has secured approval from the Irish central bank to start underwriting health insurance for the Laya Healthcare business it acquired last year for €650 million.
A unit of Zurich-based reinsurance giant Swiss Re, called Elips Insurance, has underwritten Laya policies for years, meaning the business has essentially been a tied agent.
Dublin-based Axa Insurance Dac plans to start underwriting Laya coverage from January. This will add about €940 million of premiums on an annual basis, almost doubling the company’s total premiums to about €2 billion.
Axa Insurance, a unit of French insurance multinational Axa, is the largest general insurance company in the Republic, with more than a 30 per cent of the motor market. Laya is the second-largest health coverage provider, with over a 28 per cent slice of activity.
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The insurance group has received a so-called no objection letter for a business plan change to start underwriting health insurance, it told staff on Wednesday.
“This is a significant milestone following our acquisition of Laya healthcare last year,” said Axa Insurance chief executive Marguerite Brosnan. “It provides added momentum to our business, enabling us to continue to unlock the synergies and opportunities of both Laya healthcare and Axa.”
Laya Healthcare has increased its premiums three times since early last year in line with rises by rivals amid a sharp increase in claims costs across the sector. The company’s long-standing managing director Dónal Clancy said in February that its claims expenses had increased by 35 per cent over the previous 24 months and that the upward trend was continuing.
Axa Insurance’s net profits rose threefold in 2023 to €95 million as insurance premiums rose 9 per cent to breach the €1 billion mark. Personal motor premiums accounted for €605 million, or 57 per cent, of the €1.07 billion total.
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The unit’s insurance business rebounded to a net profit of €28 million last year from a €4 million loss in 2022. The company’s investment portfolio delivered a €75 million profit, up from €29 million the previous year.
The Irish business has paid €270 million of dividends to its parent over the past four years, including money that was temporarily stored up during the Covid-19 pandemic when regulators ordered insurers to avoid payouts and preserve capital.
Laya will be consolidated into Axa Insurance’s annual accounts from this year.
Axa is one of the top five health insurance providers worldwide with a presence in all of the key health insurance markets outside of the US, including France, Germany, Britain, Mexico, and Japan.
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