UK Premiums grow 3% to £2.69bn but commercial lines dip 9%
Royal & Sun Alliance (RSA) has posted a 4% increase in operating profit for the year, despite UK flood losses of £120m.
RSA said its operating result for the year to 31 December, 2007, came in at £814m compared to £780m in 2006.
Net written premiums were up 6% to £5.84bn from £5.48bn, reflecting strong international, emerging markets and targeted UK growth. UK net written premiums rose 3% to £2.69bn driven primarily, the company said, by Affinity deals signed in 2006 and organic growth.
In the UK, the insurer saw its commercial lines premiums fall 9% to £1.66bn, due in part to rate increases in property and motor of 3% and 8% respectively. Liability rates decreased by 1%.
The Group's combined ratio (COR) jumped to 94.9% from 93.3%, ahead of the company's target of 96%. In the UK, RSA's COR jumped over five points to 97.6%.
Group chief executive Andy Haste also announced that the group will be known simply as RSA going forwards, rebranding from the traditional Royal & SunAlliance.
The company said it was confident it would continue to deliver a sustainable profitable performance and maintain tight operational and financial management.
Haste said: “In challenging market conditions, we have again delivered a strong performance. In 2007, we delivered profitable growth in each of our regions and achieved a strong bottom line result.
"The results have been delivered against the backdrop of a competitive rating environment, adverse large losses and weather, including the UK floods, and volatile investment markets. The results clearly demonstrate the benefit of our strong and diversified portfolio and our tight operational and financial management.
"With our strong portfolio and the actions we are taking, we are confident that we will continue to deliver the profitable performance that we have seen over the last few years. As it stands Wednesday, we expect to deliver a 2008 combined operating ratio of around 95%.
"During 2007, we resolved our last remaining legacy issue and we are now fully focused on continuing to deliver our objective of sustainable profitable performance. As we move the business forward, it is now the appropriate time to simplify and refresh our corporate brand and name."
