The insurer’s chief executive describes the headline loss as ‘disappointing’, attributing it to the ‘uniquely challenging’ circumstances arising from the coronavirus crisis

Charity owned insurer Ecclesiastical has reported a £59.7m loss before tax for the first half of 2020 – the firm attributed this decline to the impact of the Covid-19 pandemic on financial markets.

The insurer’s 2020 H1 results have been heavily influenced by the coronavirus outbreak; not only has the firm experienced a large headline loss, compared to a £42.8m profit before tax at this point last year, but Ecclesiastical has also recorded an investment loss of £48.9m and an underwriting loss of £1.3m, compared to a profitable £9.5m in H1 2019.

These figures lead to a group combined operating ratio (COR) of 101.1%, an increase on last year’s 91.4% figure. This includes a reserve of £14m for Covid-19-related claims. Excluding this amount, Ecclesiastical reported that its group COR would sit at 89.5%.

The insurer added that it “has a comprehensive programme of reinsurance to mitigate any further claim development that may be incurred over the months ahead”.

Mark Hews, group chief executive at Ecclesiastical, described the firm’s top-line figures as “disappointing”, acknowledging the “uniquely challenging” environment arising from the unprecedented pandemic.

He said: “The first half of 2020 was uniquely challenging due to the significant impact of Covid-19. However, we remain true to our core purpose and have continued to give to church, charities and communities most in need.

“Whilst our headline loss before tax is disappointing, in the main it has been driven by unrealised fair value losses on our investment portfolio. These are investments that are being held for the long-term and on which we have already seen some recovery. We expect this to continue over the months and years ahead and we continue to take a long-term view and look beyond the current pandemic.

“We also recognise that some customers have been disappointed that their policy has not provided business interruption cover during the pandemic, in common with much of the market.

“As a result, we were pleased to participate, alongside seven other leading insurers, in the Financial Conduct Authority’s test case. We hope that this will provide maximum clarity for all concerned in the shortest amount of time. We expect to hear the outcome, which may be subject to appeal, later in the year.”


Despite the initial bad news held within Ecclesiastical’s H1 results, Hews added that the firm’s “underlying performance is resilient and we are starting to see activity returning to normal levels”.

For example, its gross written premium (GWP) has increased by 9%, rising from £185m in 2019 to £202m this year. Furthermore, Ecclesiastical’s broking and advisory businesses contributed £1.4m of profit within H1 of 2020, despite the impact of Covid-19; the June income levels for these divisions has also now returned to 2019 levels.

Hews added: “We recognise and understand that the coronavirus pandemic has created a worrying and uncertain time for many customers and businesses and we recognise the challenges they have faced.

“As an ethical insurer, we are driven by a desire to help our customers in their moment of need and we have continued to pay claims where cover was offered, quickly and fairly. We have also offered enhanced cover, free of charge, to many of our customers alongside a range of additional support measures.”

Alongside this support for customers, Ecclesiastical has also managed to continue its charitable focus during the pandemic. Hews explained: “Recognising the impact Covid-19 has had on communities, we’ve continued our programme of giving during this difficult time.

“Following the £32m record grant we announced in March, we launched our £1m Movement for Good awards for the second year and distributed £500,000. We also responded to coronavirus response appeals initiated by the National Emergencies Trust, Disasters Emergencies Committee and Association of British Insurers by donating £200,000.”

Looking ahead into Q1 2021, Ecclesiastical plans to move into its new office space, which was completed in June and is currently being fitted out.