Product category:
General insurance
News Release from: Allianz Cornhill Insurance plc | Subject: Tax
Edited by the Insidemoneytalk Editorial
Team on 21 March 2007
Allianz Cornhill: 2006 - A year of
substantial achivement
Record profit before tax at ?239m - up 16%
Combined ratio reduces 0.8% to 94.1% Shareholders' funds top £1billion - up 8.7% to £1006m 2006 2005 Profit Before Tax £239.4m £206.4m Gross Written Premium Income £1,634.0m £1,665.5m Combined Ratio 94.1% 94.9% "2006 was a year of substantial achievement for the Group Pre tax profit was at a record level for the company and despite continued rating pressure, our combined ratio reduced 0.8% to a very pleasing 94.1%
This article was originally published on Insidemoneytalk on 23 Feb 2007 at 8.00am (UK)
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"All our trading divisions made strong contributions to the record profit performance and delivered results well in excess of the cost of capital.
"The Group continues to pursue its strategy of only underwriting business where there is a realistic prospect of achieving an acceptable level of profit." 2006 Business Highlights: Commercial Lines delivered an outstanding combined ratio of 92.3% Personal Lines returned to underwriting profit with a combined ratio of 99.2% Speciality Division made satisfying levels of profit across its business streams with a combined ratio of 94.0%.
"All our trading divisions made strong contributions to the record profit performance and delivered results well in excess of their cost of capital.
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The performance of Allianz Cornhill Commercial was once again exceptional in difficult market conditions.
"The Group will continue to pursue its strategy of only underwriting business where there is a realistic prospect of achieving a return in excess of the cost of capital.
"2006 was a year of almost unprecedented mergers and acquisitions and the Group completed the acquisitions of Home and Legacy, a specialist personal lines intermediary in the mid to high net worth sector and Premierline Direct which focuses on the SME market, as well as an equine insurance business.
These acquisitions enhance our distribution capabilities and presence in a number of key markets.
The Group will look to make further acquisitions if the right opportunities can be identified at a reasonable price, coupled with the prospect of acceptable returns and a good strategic fit.
"The London Property Owners team which was launched in Q3 combined the strength of new arrivals with existing expertise within the Allianz Group.
I am delighted with the contribution this team is already making to our financial performance and I fully expect us to build a market leading position over the next three years.
"The numerous projects being undertaken with other companies in the Allianz family to leverage the skills and expertise in specific areas of competence have been successfully progressed in 2006.
These projects have made significant contributions to the reduction in the 2006 combined ratio.
Further benefits from these projects and additional ones that have been initiated more recently are expected in 2007." 2007 Outlook: "Looking ahead to 2007, it is good to see that economic reality has returned to the important personal lines motor market with rating increases being implemented to enable the market to return to acceptable levels of profit.
We are taking advantage of these improved conditions to grow our private motor book once more.
By contrast, the rating and the competitive environment in the commercial lines market remains challenging, particularly for good quality business.
Underpinning results with prior year reserve releases can only go on for so long and my expectation is that insurers will look at their current accident year combined ratios and react by increasing rates to more appropriate levels during 2007.
"Also in April 2007, the company will change its name from Allianz Cornhill to Allianz Insurance plc.
The worldwide recognition, reputation and reach of the Allianz Group brings considerable commercial advantages to this company as does the financial strength of the Allianz Group as a whole.
This year, Allianz will launch its first global advertising campaign for five years, targeting the global financial community and local business decision makers.
By changing our brand name we can leverage this activity to maximum effect.
"Barring weather catastrophes, I fully expect to report that 2007 was another excellent financial year for the company just as the market and our shareholder has come to expect from us." Andrew Torrance Chief Executive 20 March 2007.
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