Weather losses wash away Irish profits

Liability insurance was the one bright feature for Irish insurers in 2008 even though premium volume fell by over 13%. The fall was most pronounced in employers’ liability reflecting Ireland’s severe economic contraction which has particularly affected construction activity. There were fewer new employers’ liability claims in 2008 and overall claims costs also fell significantly but the trend in public liability was adverse with claims rising both in number and cost.

A five-year period of outstanding profitability for the Irish non-life insurance market came to a very abrupt end last year, recently released statistics from the Irish Insurance Federation (IIF) confirm. The combined ratio calculated by the IIF increased to 98.1% from 78.9% in 2007 and with sharply declining investment returns drove operating profits down by more than three quarters to €227.7mn.