The conventional wisdom in the Irish insurance industry, in both the life/pensions and general side, is that there are too many companies chasing the business.
For years, industry chiefs have been saying that the Irish insurance market is not big enough to provide a living for all the companies. The reality, however, is that - apart from a couple of high-profile mergers, such as that between Hibernian and Norwich Union, and Bank of Ireland's takeover of New Ireland - little has happened.
Many companies in both life/ pensions and general insurance still operate with minuscule market shares and, while market share is not the sole arbiter of an insurance company's worth, being bigger means economies of scale and greater distribution capacity.
In life and pensions, where gross premium income rose from £4.7 billion (€6 billion) in 1999 to £5.9 billion last year, the main feature was the increasing dominance of Irish Life, where the Irish Permanent branch network is seen as increasingly important for the distribution of Irish Life products.
Irish Life's market share rose from 28.3 per cent to 32.3 per cent, with its gross premium income last year more than £550 million higher than in 1999.
The combined market share of Bank of Ireland's two subsidiaries, Lifetime and New Ireland, also rose - from 13.2 per cent to 14.7 per cent, with gross premium income more than £235 million higher on £862 million. There were more modest gains in market share for the AIB-owned Ark Life and Canada Life. But Eagle Star, Scottish Provident and Standard Life all lost market share, while the combined market share of the various elements that were merged into Hibernian Life fell from 13.1 per cent to 10.3 per cent.
Hibernian may have lost market share in life and pensions but in general insurance its market share of 23.9 per cent last year was well ahead of the combined 19.8 per cent of CGU, Hibernian and Norwich Union in 1999. Gross written premiums rose from £354 million to more than £507 million.
The next biggest players in general insurance, Allianz, AXA and Royal & SunAlliance, lost market share, although in gross written premiums were well up on 1999.
Among the smaller players, the most significant gains were by Quinn Direct, whose gross written premiums rose 60 per cent to more than £100 million and whose market share rose from 3.5 per cent to 4.8 per cent. The other big improvement was by AIG, whose market share increased from 3.7 per cent to 5.7 per cent.
Market shares for both life/pensions and general insurers have been calculated from figures in the 1999 and 2000 factfiles from the Irish Insurance Federation.
