Operating profits at Hibernian Life reached nearly €55 million in the first six months of 2007, up from about €12 million for the same period last year.

Overall, Hibernian posted an operating profit of €166.9 million, up €30.5 million - or 22 per cent - on the corresponding period in 2006. However, its general insurance operating profit was down 8 per cent to €118 million, with general insurance premium income also down marginally to €375.9 million. This reflects higher claims frequency and what Aviva said were intense competitive pressures within the market which are leading to falling premiums.

Total life and pensions business sales rose by 62 per cent to €1.3 billion in the first half, with sales through Hibernian's bancassurance operation with AIB almost doubling to €642 million.

This was comprised of €458 million of life sales, consisting primarily of single premium bonds, and €184 million of pension sales.

Sales growth in the six months reflected the successful launch of Hibernian's Secure Capital Fund in January 2007, a sales initiative on life savings products and increased pension sales driven by strong fund performances, according to parent company Aviva.

Sales through Hibernian's broker channel were 37 per cent higher at €671 million, Aviva said. Life sales rose by nearly 14 per cent to €220 million, reflecting strong sales of its Secure Capital Fund. Pension sales soared by 52 per cent to €451 million, reflecting higher sales of investment-only business. New business profits stood at nearly €21 million, up from €16 million in the first half of 2006, although margins slipped to 1.6 per cent from 2 per cent last year.

"The reduction in the margin primarily reflected the continuing impact of assumption changes made in December 2006," Aviva said, adding that the margin has improved since as a result of new product developments and re-pricing.

"We are very pleased with the strong set of results for the first half of the year from the life business," said Hibernian chief executive Stuart Purdy.

"We have entered into a period of growth after realigning and restructuring elements of our business in 2006, with total life and pensions sales increasing 62 per cent to €1.3 billion."

Hibernian is to launch a health insurance product Hibernian Health next week in its 27 branches and will compete directly with VHI's Plan B product. A spokesman said it would offer a 20 per cent discount on VHI's pricing and would include treatments such as laser eye surgery.