Last year saw mixed results in non-life insurance - John Lyons on the new Central Bank Insurance Statistics
In the non-life insurance sector total premiums on Irish risk business fell by over 10 per cent, while foreign risk business grew by 3.3 per cent, writes John Lyons. The latest figures also show that Zurich accounts for almost half of all non-life liabilities supervised by the Central Bank of Ireland.
2013 was a year of contrasting fortunes for the domestic and international non-life sectors according to the new Central Bank Insurance Statistics.
John Lyons
John Lyons

Domestic business
The total Irish risk business was down 10.1% in 2013 with Gross Written Premiums (GWP) of €2,993m compared with €3,331m in 2012, and the overall operating result went from +€191m to -€116m or -3.9% of GWP.

The Insurance Ireland membership accounted for 86% of GWP in 2013 and included all the largest players. According to its FactFile the top eight companies last year were as shown in Table 2.

It can be seen that the largest component of the decline in overall Operating Result is the negative swing in the RSA results partially offset by a positive turnaround at Aviva. Most of the companies however had a decline in Operating Results in 2013.

The overall negative swing last year can be attributed largely to the Motor sector (also the largest sector) as can be seen in Table 3.
Although most sectors saw a decline in profitability, the biggest reverse was in the Motor sector. This has been quite a battleground and although the largest losses can be attributed to RSA and its well known issues, most companies had a torrid time. The overall result was however bolstered by a positive turnaround at Aviva.

International business
Total foreign risk business written by companies from their Irish Head Offices (or by Irish branches of companies headquartered in other EU states) was up slightly in 2013 with GWP of €3,798m compared with €3,676m in 2012, an increase of 3.3%. The overall net Operating Result was up 67 % from +€309m to +€516m.

The international risk business is very diverse by sector and widely spread among some 111 companies, many of them captives.

The top five companies last year, ranked by Net Premiums, were Allianz Worldwide Care (€408.5 million); CACI non-life (€178.7 million); Europ Assistance (€139.9 million); ENI Insurance (€138.4 million) and Euro Insurances (€ 128.6 million).

In addition to this is the foreign risk business written by branches of Irish companies located outside Ireland, where solvency is supervised by the Central Bank of Ireland. The total GWP here was €9.2bn (€3.6bn net) in 2013 compared with €9.6bn (€3.8bn net) in 2012. 88% of this business was written by Zurich Insurance plc which has made Ireland an international hub. The significance of the Zurich business to the Irish supervisors can be seen in Table 30 of the 2013 statistics where it now represents €15.3bn out of the total non-life liabilities of €32.2bn supervised by the Central Bank (the next highest two are AXA and Allianz Ireland with €1.65bn and €1.53bn respectively).
John Lyons is insurance correspondent for Finance Dublin and an independent non-executive director.
This article appeared in the November 2014 edition.