QUINN-direct Insurance - CONTINUED GROWTH IN 2005
QUINN-
direct - Further gain in market share as prices continue to fall.
1 March 2006
| |
2005 |
2004 |
| Premium Income |
€621m |
€473m |
| Underwriting Profit |
€119m |
€109m |
| Investment Gains |
€113m |
€44m |
| Pre-Tax Profit |
€232m |
€153m |
QUINN-direct Insurance today announces that it made a Pre-Tax Profit of €232m in 2005. Written premium increased by 31% to €621m over the same period. As a direct result of our policy of consistently reducing prices over the past 3 years, we have more than doubled our customer base to over 350,000.
Premium income increased across all our business lines in Ireland, firmly establishing our position as a Top 3 player in Motor and Commercial Liability. We are particularly pleased with the progress we have made in further developing our presence in the UK market.
The Company's underwriting margin has reduced in the period as a result of price reductions and increased levels of business being written in the UK. As the company has only recently entered the UK market it has adopted a very prudent approach to calculating claims reserves. Notwithstanding this, we are very happy with the profitability of and prospects for the UK business.
The Company's investment portfolio enjoyed a very profitable year as global equity markets had a particularly strong finish to 2005. We regard our Investment Gains in 2005 to be above normal and would expect a return to more normal levels of return over the coming years.
We continue to invest in our committed and dedicated workforce, which we believe is our most valuable asset. We provide them with the most modern technology that enables them to provide the highest possible level of customer service to our clients.
The General Manager of QUINN-direct; Colin Morgan said:
"We are very pleased with the performance of the business in 2005 and in particular with the growth in premium income we generated across all business lines in Ireland and the UK. Our ability to continue to grow while maintaining strong underwriting results is attributable to a number of factors.
- Our predominantly direct business model continues to be more efficient and cost effective than traditional sales methods.
- We adopt a very proactive approach to claims management, which helps reduce our exposure to legal and related costs, while providing excellent service to customers and third party claimants.
- We have an excellent understanding of the needs of our business customers given the wide range of industries that the Quinn Group has experience of. This, combined with a true partnership approach to risk management, is proving highly successful with our commercial customers in both Ireland and the UK.
These and other factors give QUINN-direct a significant cost advantage over our competitors and enable us to pass on meaningful cost savings to customers. Indeed, we have continued to reduce premiums in 2006. 2005 has been a hugely significant year for QUINN-direct as we completed 10 years of continuous growth since we commenced operations in 1996.
As we look forward we remai very confident in ou ability to continue to grow marke share. We have concerns about certain anti-competitive practices that we believe are prevalent in th Iris nsurance market. Despite the tremendous success and stron financial position of ou organisation the three largest insurance brokers in Ireland (Marsh, Coyle Hamilton Willi and AON) do no offe ur products. It is ou view that numbe of questions need to be raise in respect of this and other anti-competitive practices withi the Irish insurance market.
- Are Irish consumers aware that in recent months, a large international insurer with operations in Ireland and the three international brokers referred to above have had to make settlements totalling over $2 billion in the United States in respect of price fixing and broker compensation packages?
- Is it appropriate that a number of insurance companies in Ireland have representatives based in broker offices?
- Why are these international brokers not offering to their clients the products of an Irish insurer with a proven track record?
- By not offering our products are these brokers in breach of Government Guidelines as independent intermediaries?
- What selection criteria do the international brokers use when you consider that they placed insurance cover with Independent Insurance who became insolvent in recent years leaving hundreds of millions of euros of uninsured risks in Ireland?
In conclusion, we believe these anti-competitive practices are in place because these international companies are unable to compete with our cost structure and they feel that the only way to retain business is for the Broker and Insurer to work together to discredit our product and then continue their "old boys network" of tying up practically all of the Business Insurance these international brokers control."
