Profits drop from €245m to €58m loss as investments hit by credit crunch
Quinn Insurance has posted a pre-tax loss of €58m, compared to a €245m profit in 2007. Operating profits fell 55% to €72m in its full year results for 2008.
In a letter to the Irish insurer’s broker partners, Quinn Insurance chief executive Colin Morgan said in the UK 'we are very happy with this result in the context of a difficult economic environment’.
The insurer’s 2008 financial results reveal Quinn took a huge hit in its investments which plunged from €84m in 2007 to €130m in the red. Writedowns in equities and property bore the brunt of Quinn’s losses.
Quinn also said it was also affected by increased claims, and the absence of releases on prior year reserves due to higher claims settlement costs.
Morgan said: “We have great confidence in the strength of our business model and our ability to generate underwriting profits in our core markets.
“These results represent a robust performance against the backdrop of difficult economic conditions and a very competitive marketplace. After several years of strong growth we have maintained strong underwriting discipline and resisted the temptation to follow some of the apparently uneconomic pricing witnessed in the market and this has led to a reduction in premium income.
“While the current economic conditions provide challenges for all companies Quinn Insurance is well equipped to deal with them. The company’s proactive claims settlement model which is continuously being enhanced allows us to settle claims faster than competitors, benefiting all parties including policyholders and claimants. In addition, in recent months we have experienced premium rate increases across most business lines. We continue to invest in technology and our tight cost control processes allow us to meet our customer needs in an efficient manner.”
Quinn’s 2008 results
- Premium Income €1,072m (€1,093m, 2007)
- Operating Profit €72m (€161m)
- Investment Gains/(Losses) (€130m) €84m
- Pre-Tax Profit/(Loss) (€58m) €245m