Allianz’s UK division made an operating profit of €40m (£35m) in the first quarter of 2011, down 5% on the €42m it made in the same period last year, according to the Allianz Group’s Q1 interim report.

The Q1 2011 combined ratio was 97.1%, up slightly in Q1 2010’s 96.5%. The combined ratio increase was driven by higher claims: the loss ratio increased to 65.3% from 62.8%, while the expense ratio dropped to 31.8% from 33.7%.

Allianz wrote UK gross written premiums of €519m in Q1 2011 (Q1 2010: €463m).

Excluding €19 million of favorable foreign currency translation effects, this was an increase of 8%.

Allianz said almost all business lines contributed to the UK premium growth. Tariff increases, especially in the motor and animal health insurance businesses, led to a positive price effect of about 5.4%. In addition, the insurer grew gross premiums in its private household and legal protection businesses by expanding its distribution network.