VHI enjoyed post-tax profits of €65m

Health insurer VHI made a 2013 profit after tax of €65m compared to a profit of €54.3m for the previous year.

At the end of last December VHI had free cash reserves of over €389m, bring the company’s solvency ratio to 156% compared to 108% in 2012 and 100% in 2011.

The company also announced that it had finalised a four-year reinsurance agreement with Berkshire Hathaway and had made an application for authorisation by the Central Bank of Ireland.

“Vhi Healthcare continued to perform well in a challenging market in 2013. We recorded a strong surplus on our consolidated business, improved our solvency position and maintained a low operating cost ratio. The improved financial results have been achieved on the back of a number of key initiatives taken in 2012 and 2013 which will continue to bear fruit in future years,” said John O’Dwyer, CEO, Vhi Healthcare.

“These initiatives focussed primarily on claims cost management and the cost of claims has reduced by 2.1% in the year. The business also purchased reinsurance for the first time in order to improve its solvency position.”

Earned premium totalled €1.490.46bn last year, up 4.1% on the previous year, with €21m in income from products and services other than health insurance.

Total gross claims paid in 2013 came to €1.366bn, down 2.1% on 2012, while operating expense ratio to premium income was 6.2%, the same as in 2012.