The company said in a statement: “The previously signalled claims uncertainty in Ireland has continued and deteriorated further. The existing business strategy has not delivered profitable growth and, given the significant losses reported today [Monday], the group has reviewed its strategic direction”.
The firm is to embark on a process of “significant reserve strengthening”, and has already strengthened prior year reserves by €88m.
According to the company, “the adverse case reserve development experienced in the first half of 2015 has been worse than any previous periods.” It attributed this deterioration to legal changes around claims which have taken place over the past 18 months.
Meanwhile, the company is also moving to a focused business strategy, concentrating on its farming and agri book, and plans to divest its stake in FBD Property and Leisure.
“These results reflect very serious increased claims costs in our industry,” said Muldoon.
“We are taking decisive action now to de‐risk our strategy and return to profitability by the end of 2016.”