Tuesday 6 December 2016

Farmers to escape extra expense as FBD ups premiums

Published 24/08/2015 | 02:30

The troubled insurer has already seen the departure of chief executive Andrew Langford at the end of July
The troubled insurer has already seen the departure of chief executive Andrew Langford at the end of July

Farmers are expected to escape premium rises but drivers will be hit as FBD insurance is expected to report losses later today and signal that it will continue to increase prices.

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The troubled insurer is due to report financial results for the first six months of the year.

Dublin Stock Market watchers are braced for more losses, after the group sank into the red to the tune of €4.5m last year.

It is expected to confirm that it will increase its private motor and commercial insurance premium rates.

However, farmers are expected to escape premium rises as the company attempts to protect its core customer base.

Industry sources said the insurer had no choice but to hike its premiums for businesses and drivers.

It has been rocked by the loss of its chief executive, made heavy losses on motor insurance and must raise €100m to meet new regulatory rules.

FBD's share price on the Dublin Stock Market is down almost 40pc this year, seeing its valuation plunge to €240m.

The group, which has a strong farmer customer base, has been notching up large losses after it branched into seeking customers in urban areas.

FBD plans to sell its property and leisure assets, but this is unlikely to provide the insurer with adequate capital to meet the new regulatory rules.

The company revealed this month that it needs to raise €100m to meet new regulatory rules for insurers by January 1.

Most insurance companies are racking up losses at the moment on motor insurance, due to under-pricing of premiums, and more frequent and larger-than expected claims.

Irish Independent

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