Brit Insurance moves to protect its margins as rates remain depressed

BRIT INSURANCE expects premium growth to remain depressed this year after the group reported a double-digit drop in first quarter numbers.

The group’s chief executive Dane Douetil said in an interim statement yesterday that he did not expect to see premium volume growth during 2010.

His comments come on the back of Brit’s first quarter results showing that the group’s premiums fell by 13.3 per cent to £483.5m, while average premium business renewals fell to 1.4 per cent from 4.6 per cent.

However, Douetil said yesterday that the underwriting market had developed broadly in line with the group’s expectations.

He said: “We are seeing reduced premium volumes. This is to be expected at this part of the underwriting cycle and we are working hard to enhance our underwriting portfolio.”

Brit Insurance suffered from a number of losses during the first quarter but February’s earthquake in Chile, which cost it £46m, was the largest.

“The earthquake in Chile will be a significant market loss and our expected exposure in relation to our size reflects the controlled nature of our catastrophe account,” said Douetil.

It is estimated that the insurance industry lost $16bn (£10.7bn) during the first quarter of 2010 not only as a result of the earthquake, but also the Xynthia windstorm, Australian flooding, severe US and UK winter weather, and hail storms.