FBD Group said on Thursday that it remained confident in its underlying profitability and growth prospects, even as general inflation is driving up the costs of settling property and motor claims.
The company, led by chief executive Tomás Ó Midheach, said in the trading update ahead of its annual general meeting, that its injury claims experiences so far this year has been “benign” and that there have been no significant weather events.
“Overall, we remain confident in the underlying profitability, future growth prospects, capital strength of the business and in our ability to continue to provide excellent service to our customers,” Mr Ó Midheach said.
FBD said it still expects its net Covid-19 business interruption payouts to pubs to come to €44 million – an estimate it outlined at the time of its full-year results in March. The company is not currently giving an estimate of the gross expected costs of payments to 1,000 pubs affected by a landmark court ruling on a small number of test cases in February last year and a follow-up judgment in January.
“Following the quantum hearing judgment in January, we are engaging with the plaintiffs on the steps needed to bring final clarity for all concerned,” it said.
The company said it continues to monitor the implementation of Judicial Council personal injury guidelines published in April last year. While the guidelines led to a 42 per cent drop in Personal Injuries Assessment Board awards between April and the end of 2021, there has been an increase in the level of rejections of awards by claimants, compared with normal trends, as many opt to take their case to court.
FBD’s gross written premiums have risen by 1 per cent so far this year compared with the same period in 2021, after adjusting the prior year for Covid-19 related premium rebates. Written policy count has increased by 2 per cent with average premium falling by 1 per cent.
The average private motor premium for the first quarter was down 9 per cent on the year-earlier figure.
“Investment markets have been difficult year to date and this has impacted the valuation of our risk asset and bond portfolios and has led to negative returns through the income statement and the statement of other comprehensive income,” Mr Ó Midheach said. However, he said rising interest rates in the market will have a positive effect on future income returns.