After an exceptionally difficult year, FBD has recorded a full-year net loss before tax of €85m. An underwriting loss of €113.8m was recorded for the full year.

The losses were mainly driven by the development of prior year claims of €96m – €88m of this had been reported in the first half of 2015. The loss includes a restructuring charge of €11m for the full year.

The pre-tax losses reflect a change in investment accounting presentation and a number of exceptional items.

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Fiona Muldoon, the newly appointed group chief executive, said that “after an exceptionally difficult year, FBD has stabilised and our corrective pricing and risk selection actions are building momentum towards restoring profitability”.

Gross written premiums remained similar to the previous year, at €363m. This reflected a 9% increase in premium rates. Policy volumes were back by 9%. Given the low return environment, investment returns were strong at 2.2%.

The group has also identified and implemented cost savings of €8m, as targeted in the 2015 half-yearly report. A voluntary redundancy programme was completed in the second half of 2015. FBD said that the majority of savings will be realised from the end of the first quarter of 2016.

In August 2015, the group outlined a number of measures to strengthen its capital position; divesting its stake in FBD Property & Leisure Limited, overhauling the legacy staff pension scheme and exploring options for raising regulatory capital in debt capital markets.

Net claims increased by 35% to €341m, but this includes €96m for prior year claims. The combined operating ratio (COR) improved from 110% in the first half to 101.5% in the second half, which led to a full-year result of 105.7%.

FBD said that it will continue to maintain its focus on the insurance needs of agricultural customers.

Governance – chair to retire

Significant governance changes have also been announced today . FBD Holdings and FBD Insurance, which up until now had two boards, will now see these amalgamated which will lead to new appointments. Four directors will not go forward for re-election at the 2016 AGM and Michael Berkery, who has been chair for the past 19 years, will retire at the 2017 AGM.

Muldoon said that “these changes reflect FBD's focus on our general insurance company and our life and pensions intermediary".

Outlook

FBD said that despite rates improving, industry profitability continues to be challenging, and it believes that the industry will continue to be loss-making for 2016. It said that this is mainly because the market has not yet increased rates sufficiently to compensate for the significant deterioration in the claims environment. FBD said that compared with late 2014 and early 2015, the weather loss experience since the start of 2016 was not severe. FBD said it is committed to taking whatever action is required to return the business to profitability.