General insurers saw net claims incurred jump 20 per cent in 2009 when compared to the year prior, even while revenues grew by only eight per cent.
Gross premiums booked by 10 general insurers last year totaled $23.3 billion, up from $21.5 billion, while net claims rose by $1.6 billion to $9.4 billion.
The result was larger underwriting losses from the insurers core business, with the exception of General Accident which managed to eke out underwriting profit of $34 million in 2009, compared to the $125 million underwriting loss the year before.
Across the industry underwriting losses climbed 161 per cent to $2.6 billion, which translated to lower net profit at the bottom line.
The 10 insurers netted $1.4 billion in 2009, down 38 per cent from the year before.
But even while the industry showed bleak figures as a whole there were those that bucked the trend.
West Indies Alliance (WIA), ICWI, Globe Insurance, BCIC, Victoria Mutual Insurance and Jamaica International Insurance Company (JIIC) all returned higher net profit than the year before.
Globe saw its net profit grow from $342 million to $433 million, followed by WIA, which saw its net profit grow from $137 million to $199 million. JIIC grew its bottom line from $159 million to $188 million, BCIC from $102 million to $131 million, VMI from $109 million to $121 million and ICWI from $31 million to $65 million.
But NEM net profit dropped from $548 million in 2008 to $135 million while Advantage General (AGI) bottom line plunged $56 million into the red after posting a net profit of $567 million in 2008.
Incidentally, General Accident — the only company to improve its underwriting profit — reported a $25 million reduction in net profit, or $155 million for 2009.
Most general insurers, or six of 10 failed to meet the Financial Service Commission’s (FSC’s) minimum asset test (MAT), which requires that accepted assets must represent 135 per cent of liabilities.
Even more failed the year before — seven of 10.
Only JIIC was able to improve its position past the mark from 133 per cent in 2008 at 143 per cent in 2009.
On the other hand, only three companies failed to improve their score under the MAT. And of those only one actually failed the test — AGI’s MAT dropped from 120 per cent to 115 per cent putting it even deeper below the regulatory requirement and placing it as the lowest scorer in 2009.