Chief executive pledges pricing discipline as impressive results are unveiled
AXA Insurance's chief executive Peter Hubbard will remain "disciplined on pricing" to keep the insurer's combined ratio down.
Unveiling impressive half-year results for the UK general insurance division, Hubbard said: "Over the coming months we will keep control of our underwriting and pricing, which is fundamental to our position. The best articulation of this is looking at our loss ratio, which on aggregate is 59.4%."
AXA UK's combined ratio improved by 3.9 points to 98.5% in the first half of 2004. Underlying earnings were up 138% to £99m from £41m in the first half of 2003.
Hubbard said: "We made £34m profit on a post-tax basis for the first half of this year, compared to an actual loss of £87m in 2003. So in fact with that profit taken into account, we have seen a £100m turnaround this year."
Total revenue in AXA UK general businesses increased from £1.54bn to £1.62bn, driven by the hard market in liability classes and higher than average premiums in AXA/PPP Healthcare's business.
"Rates are staying reasonably high in liability and I don't see any major softening," said Hubbard.
Property and casualty business in the UK and Ireland was up 6.4% to £2.36bn from £2.22bn in the first half pf 2003. But in personal motor, revenues were down 17% and commercial motor was down 3%.
"AXA made a conscious decision back in 2000 to reduce our interest in the private motor market," said Hubbard.
Overall the intermediary division was up 9% and Hubbard praised the work of commercial and intermediary lines director Mark Cliff. Personal intermediary business was also up 4%.
Hubbard said further job cuts and "site streamlining" would continue. "In January I said 700 jobs would go and I'm sticking to that figure."