Profit margin weakened by rise of bodily injury claims
Equity Red Star posted a profit before tax of A$36m (£22m) for the second half of 2009, a fall from the A$77m recorded for the first half of the year.
Nonetheless, this left the specialist car insurer with a strong full-year profit of $113m, though its margin was eroded by bodily injury claims.
Parent company Insurance Australia Group (IAG) said in a statement: “A lower margin of 6.6% reflected reserve strengthening for prior-year bodily injury claims and weaker investment returns, both of which have been felt across the UK industry.”
IAG’s profits increased from A$227m in the first six months of last year to A$488m for the final half.
IAG managing director Mike Wilkins said: “Our significantly improved first-half insurance profit demonstrates that the actions we’ve taken over the past 18 months have delivered tangible results.”