Shannon redundancies help Halifax Assurance profits

A SHANNON-BASED workforce that was cut by 80 earlier this year contributed to a life assurance company recording pre-tax profits of £29.4 million (€32.5 million) last year.

Earlier this year, the Lloyds Banking Group- owned St Andrew’s Group in Shannon made 80 workers at its Shannon base redundant as part of a move to axe 200 jobs across its insurance division.

New accounts filed to the Companies Office show that St Andrew’s Group subsidiary, the Shannon-based- Halifax Assurance Ireland Ltd (HAIL) recorded pre-tax profits of £29.4m last year and this followed pre-tax profits of £37.3m in 2009.

The company paid £43.7m in dividends last year to its UK parent.

HAIL underwrites life assurance and permanent health insurance elements of Payment Protection Insurance (PPI) cover for the Lloyds Banking Group.

The directors’ report states: “During the year, Lloyds Banking Group made the decision to cease selling PPI resulting in no new policies being underwritten since July 2010. A significant book of policies remains in place which continues to provide monthly premium income to the company.”

The directors state that on February 8, 2011, the company announced a reduction in its workforce following the decision to cease the sale of PPI by Lloyds Banking Group plc.

The directors state that HAIL “is currently reviewing its operations and how it can participate within the Lloyds Banking plc insurance strategy.”

HAIL is a sister company of the Shannon-based Halifax Insurance Ireland Ltd (HIIL) and HAIL’s payroll costs of the company’s 343 employees are incurred by HIIL.

The figures show that HIIL last year incurred a pre-tax loss of £6m following a pre-tax loss of £26m in 2009. HIIL paid out a total dividend of £19.2m last year.

The principal activity of HIIL is to underwrite general insurance elements of repayments insurance cover for Lloyds Banking Group plc.