In a statement released today, which covers the third quarter the group is predicting a full year 2014 operating loss of zero to ten cent per share excluding any exceptional events that may arise.
So far this year, FBD’s profitability have been impacted by severe weather, an increase in frequency associated with economic growth, poor large claims experience and adverse development of prior year injury claims.
The group is reducing the forecast result for the final quarter of the year by €10m. It blames the unprecedented volatility in claims costs in recent months.
The group said in the second half to date, the frequency of attritional bodily injury claims relating to car insurance was in line with expectation. However, during this period, “the development pattern on a small number of prior year medium-sized injury claims (cost between €0.2m and €1m net of reinsurance) has been significantly higher than normally expected.
This the company said related to accidents that occurred in 2011 and 2012 and was due to factors such as the deterioration in claimants’ medical conditions or an increase in the probability of liability.
Following a detailed review, the company claims there is no reason to believe that this development is systemic or that the experience will recur in future periods.
In addition, FBD has experienced an increase in large claims costs due to a very small number of very large accident and liability claims (cost greater than €1m net of reinsurance).
Such large claims, were in line with expectation in the first half, cost €7m more than expected in the four months to October.
The combined cost of the claims and maintenance of the reserve level results in a charge of €13m.
Shares were down more than 20% in early trade this morning.
In a statement released today, which covers the third quarter the group is predicting a full year 2014 operating loss of zero to ten cent per share excluding any exceptional events that may arise.
So far this year, FBD’s profitability have been impacted by severe weather, an increase in frequency associated with economic growth, poor large claims experience and adverse development of prior year injury claims.
The group is reducing the forecast result for the final quarter of the year by €10m. It blames the unprecedented volatility in claims costs in recent months.
The group said in the second half to date, the frequency of attritional bodily injury claims relating to car insurance was in line with expectation. However, during this period, “the development pattern on a small number of prior year medium-sized injury claims (cost between €0.2m and €1m net of reinsurance) has been significantly higher than normally expected.
This the company said related to accidents that occurred in 2011 and 2012 and was due to factors such as the deterioration in claimants’ medical conditions or an increase in the probability of liability.
Following a detailed review, the company claims there is no reason to believe that this development is systemic or that the experience will recur in future periods.
In addition, FBD has experienced an increase in large claims costs due to a very small number of very large accident and liability claims (cost greater than €1m net of reinsurance).
Such large claims, were in line with expectation in the first half, cost €7m more than expected in the four months to October.
The combined cost of the claims and maintenance of the reserve level results in a charge of €13m.
Shares were down more than 20% in early trade this morning.
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