Thursday 13 December 2018

Shares in FBD up 4pc on Storm Ophelia news

Tree Surgeons take dawn a fallen Tree on Northbrook Road Ranelagh .
Tree Surgeons take dawn a fallen Tree on Northbrook Road Ranelagh .
Ellie Donnelly

Ellie Donnelly

Shares in FBD rose by over 4pc this morning on the news that last week’s Storm Ophelia is expected to cost the company between €4m-€6m.

The cost of claims, once reinsurance has been paid to FBD, will be €2.5m.

Elsa (7) and Tom (5) Dollard walk their dog on Centre Park Road in Cork after Hurricane
Ophelia. Photo: Mark Condren
Elsa (7) and Tom (5) Dollard walk their dog on Centre Park Road in Cork after Hurricane Ophelia. Photo: Mark Condren

FBD said that the overall net impact of the storm will increase to between €4m-€6m after it pays an additional reinsurance premium to reinstate its catastrophe weather limits for the balance of the year.

However it had been expected that the cost would be higher.

A fallen tree blocks the R292 at Culleenamore, Strandhill, Co. Sligo. Photo: James Connolly
A fallen tree blocks the R292 at Culleenamore, Strandhill, Co. Sligo. Photo: James Connolly

FBD CEO Fiona Muldoon said that, despite the impact of Storm Ophelia and other recent weather related claims, the insurance company continued to see a steady improvement in its financial performance from both better risk selection and improved price adequacy.

"Absent further severe weather in 2017, we are now on course to deliver our targeted "low double digit return on equity" earlier than previously indicated.

If the remainder of 2017 is reasonably benign in weather terms, we believe this return is achievable in this financial year," Ms Muldoon said.

Since Storm Ophelia hit Ireland last week, FBD has been working with customers to compensate them for the damage caused to their homes, farms and businesses.

The largest number of claims to-date have come from countries Cork and Tipperary.

When contacted by Independent.ie the insurance group said that it does not comment on price increases other than to say that, "like any business, costs must be covered by the price charged over time and all prices are regularly reviewed on all products and lines of business to ensure our business is profitable".

Last week the Deputy chairman of the Consumers' Association Michael Kilcoyne said there was no justification for rises in the cost of home and business cover.

"There are a whole lot of years when there are very few claims from householders and businesses. People pay insurance for events like this.

"That day has now arrived, so consumers and businesses should not have to pay on the double," Mr Kilcoyne said.

FBD currently has an "outperform" rating from Davy.

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