Even though FBD has struggled in the past year, it is not alone in this very competitive market - a market that has almost halved in size in the past 10 years. As the only Irish-listed insurance plc, FBD competes in a sea of large international players such as Aviva and Allianz.

The Irish general insurance market is valued at €2.6bn, a fraction of its 2003 peak when it hit €4.6bn. The dramatic fall of almost 40% has been a direct result of a reduction in the size of the economy, with less activity, fewer cars, business closures and reduced house builds.

Insurance Ireland, which represents 95% of the Irish market, said its non-life members made an underwriting loss of €211m in 2013.

Struggles

The industry has struggled to increase rates due to its fragmented nature, with a large number of players (seven control 80%) competing for a larger slice of a much smaller pie, making for very aggressive pricing policies. Unlike its competitors, FBD has not been helped by this as it is focused entirely on the Irish market.

FBD was established by farmers over 40 years ago and Farmer Business Developments, the original co-op, is the principal shareholder in FBD plc with a 24.6% stake.

FBD insurance, is just one of seven key players in the Irish market, with a share of over 13%. It is a small player, with revenues from gross written premiums of €364m. The international giants that also operate in the Irish market have turnovers that amount to multiples of this number. For example, Allianz, with 15% of the Irish market, has revenues of €7bn, and Aviva, the largest player with 22% share, has revenues of €60bn.

US giant Liberty Mutual, which bought Quinn Insurance for €1 in 2011, now has 7% of the market, but it had lost a lot of share under administration.

Adding fuel to the fire, Zurich Insurance, which has 10% of the Irish market, confirmed it is considering buying London-based insurer RSA (14% of market). The proposed deal would make Zurich the third largest insurer in Scandinavia, the second largest in Canada, and help it gain a foothold in South America.

FBD was one of the few insurance companies to increase its market share in the downturn, and last year held its largest ever share with 13.7% of the market helped by its 'No-Nonsense' brand and online offerings.

See next week's Irish Farmers Journal for more on the future of FBD.

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