Farm Ireland

Tuesday 22 January 2019

Profit jumps to €50m at FBD as Storm Ophelia costs the group just €5.4m

The roof of Douglas Community School in Cork was blown off as Hurricane Ophelia caused massive damage. Photo: Mark Condren
The roof of Douglas Community School in Cork was blown off as Hurricane Ophelia caused massive damage. Photo: Mark Condren
Ellie Donnelly

Ellie Donnelly

Profit before tax at FBD insurance jumped to €50m in 2017, a significant increase on the €11m in profit before tax recorded in 2016, according to the group’s financial results released today.

The underwriting profit includes claims pay-outs from Storm Ophelia, which amounted to just €5.4m after reinsurance recoveries and reinsurance reinstatement.

Storm Ophelia saw hurricane-force winds hit the country and caused three deaths last year.

At the time investors had braced for a significant impact on FBD when the storm struck especially hard in rural Munster, a key market for the farmer-backed group. In total FBD received more than 2,000 claims relating to the storm.

As a result of the strong performance the insurance group has proposed a dividend of 24cent per share to its shareholders.

"FBD has had an excellent year and we are pleased to see our strong strategic delivery reflected in these results," Fiona Muldoon, Group Chief Executive, said.

"After three years of hard work and corrective action, my colleagues and I have delivered a strong underwriting profit for the year."

During the year the country’s biggest stand-alone insurer delivered a 17pc return on equity, due to what the company described as an "exceptionally strong underwriting result and some positive prior year reserve development."

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Premium written during 2017 increased by 3pc to €372.5m, while the company said that it was an "excellent" year for customer retention.

However the group’s total investment return fell to 1.2pc from 1.9pc in 2016.

Ms Muldoon also used the update to warn on the rising cost of claims, which she said remained a challenge for Irish customers.

"The Government must follow through in implementing legislation to provide a lower cost, sustainable claims environment for the benefit of all insurance customers," she said.

The CEO said that FBD would work hard to ensure that Government proposals deliver for Irish farmers, businesses and consumers, which she said continued to bear the cost of significantly higher premiums than those seen in other countries.

"As productivity and stock numbers rise on Irish farms, FBD intends to continue to work with its farm customers to help deliver improved farm safety practices to halt the alarmingly high level of death and injury in the farm workplace," she said.

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