Aviva Ireland half-year profits climb 7% to €43m

Aviva Ireland has warned of the “serious challenge” claims costs continue to pose in the personal motor insurance market as it announced a €43m operating profit in the opening six months of the year.

The insurer increased its profit by 7% in H1 2016 from €40m a year ago. The general uptick in business was also evidenced by a 3.5% increase in combined operating ratio — a key measure of profitability — to 90%.

Aviva Ireland chief executive Hugh Hessing attributed the company’s improved performance to “delivering on its strategy of sustainable growth while offering competitively priced insurance cover to its customers”.

“This improvement is driven by an increase in customer numbers supported by a pricing strategy that delivers insurance cover at a price that is competitive. Performance in our personal and commercial property sector is better than expected due to benign weather.

"Claims’ costs continue to be a challenge in the personal motor market. We remain steadfast in our policy of defending our business against all cases of suspected fraud,” Mr Hessing said.

Aviva Ireland provides life insurance, general insurance and investment and savings products to one million customers in Ireland.

It recently exited the health insurance market with the sale of that business to Irish Life closing earlier this week.

Its new owner has merged Aviva’s health business with GloHealth, which it assumed full control of, to create Irish Life Health.

Aviva saw an improvement in its life insurance business with the value of new business in H1 up 58% at €14.6m.

Aviva Ireland employs 1,150 people in Dublin, Cork and Galway.