However, declining bond prices last year as central banks began hiking interest rates to tackle inflation – forcing market interest rates, or bond yields, to move higher – resulted in €10 million of investment losses being booked through FBD’s income statement. A further €90 million of investment losses were booked as so-called other comprehensive income.
FBD, led by chief executive Tomás Ó Midheach, said it expects to pay outstanding Covid-19 pub business interruption claims this year, following an upcoming High Court ruling on outstanding issues in relation to a test legal challenge mounted by a small number of pubs in 2020. The challenges forced the insurer – and reinsurers with whom it shared the risk – to accept that the pubs were eligible for payouts under its pubs policy.
FBD’s gross written premium rose to €382.9 million last year from €366.3 million in 2021, driven by a 2.8 per cent increase in policies taken out by customers. The company’s average premium increased by 0.6 per cent across the portfolio, though private motor rates declined by an average of 7.2 per cent and commercial motor reduced by 1.1 per cent per cent, reflecting the reductions seen in claims costs as a result of the new personal injury guidelines, introduced in early 2021, partially offset by the impact of increases in motor damage costs.
While rival insurer Aviva had complained on Thursday that it was seeing rising levels of Personal Injuries Assessment Board awards being rejected and the cases subsequently going down the legal route, FBD said it is “now seeing reductions in average settlement costs feeding through in pre-litigation channels”.