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One-off general insurance gain buoys Gjensidige Forsikring Q1 result

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One-off general insurance gain buoys Gjensidige Forsikring Q1 result

GjensidigeForsikring ASA posted first-quarter profit attributable to thecompany's owners of 1.11 billion Norwegian kroner, or 2.22 kroner per share,compared to 748.1 million kroner earned in the same period in 2015, or 1.50kroner per share.

"We are very pleased with a good start to theyear," CEO Helge Leiro Baastad said. "The results are driven by solidgrowth in premiums, cost efficient operations, and good control of riskselection and risk pricing."

Earned premiums from general insurance rose on a yearlybasis to 5.51 billion kroner from 5.12 billion kroner while those from pensionfell year over year to 316.8 million kroner from 333.0 million kroner.

First-quarter interest income from banking operations camein at 343.7 million kroner, compared to the year-ago 329.0 million kroner.

The company's total operating income for the period stood at6.21 billion kroner, up from the year-ago 5.82 billion kroner.

Total net income from investments declined to 332.4 millionkroner from 524.4 million kroner. Total claims and interestexpenses amounted to 4.35 billion kroner, compared to the year-ago 4.40 billionkroner.

The company saw its operating expenses from generalinsurance decline year over year to 365.2 million kroner from 769.6 millionkroner.

The underwriting result at general insurance grew to 1.25billion kroner in the first quarter from 416.5 million kroner in the sameperiod in 2015. The group said the removal of an annual minimum regulationclause for pension payments in the defined benefit plan contributednonrecurring income of 476.6 million kroner in the quarter.

The combined ratio in general insurance was 77.3%, comparedto 91.9% a year ago.

The group's annualized ROE was 19.0% in the first quarter,compared to the year-ago 13.5%. The group said it aims to achieve a 15% ROEafter tax. The capital adequacy ratio for the retail bank was15.8% at March-end, compared to 16.1% at 2015-end.

Meanwhile, the annual combined ratio is expected to be atthe lower end of the target range of 90% to 93%, undiscounted and given zerorun-off effects.

Gjensidige Forsikring said it will submit an application forthe use of its own partial internal model for Solvency II during the first half.

As of April 27, US$1 wasequivalent to 8.18 Norwegian kroner.