Weak stock markets took their toll on the Hibernian group in 2002, depressing sales of life and pensions products, and reducing the value of client funds. However, its general insurance business, which includes motor insurance, recovered to yield a profit that offset the weakness in its core business.
The insurer, part of the British-based Aviva, recorded a 24 per cent rise in operating profits to €192 million.
Commenting on the figures yesterday, Mr Tony O'Riordan, Hibernian finance director, said it was likely to face another tough year in 2003 but was taking a positive view on stock markets.
"We will have to get through this short-term uncertainty before investors start to come back into the markets. We may not return to the very large returns seen in the 1990s but we are positive in the long term."
Aviva, Britain's biggest insurer, reported a drop in profits last year and, as expected, cut its dividend to shareholders. Irish shareholders will receive a dividend of 0.2078 cent per share, which will be paid on May 16th.
Aviva's 2002 operating profit was £1.8 billion sterling (€2.6 billion), down from £1.9 billion in 2001, as it struggled with tumbling stock markets.
In the Republic, Hibernian's total premium income was down in 2002 to €1.7 billion from €1.9 billion, due to weaker income from life assurance premiums.
According to its results, gross premium income at its life and pension business dropped from €1.8 billion to €700 million last year. Sales of new life and pensions policies, in terms of annual premium income, remained steady at €163 million compared with €164 million in the previous year.
Mr O'Riordan said Hibernian's pensions products were stronger performers in 2002, with sales of single-premium investments down as investors shied away from putting funds into equitiesin the current weak environment.
The overall achieved operating profit in the life and pensions business was down from €127 million to €119 million.
The general insurance business, which had recorded losses in the previous two years, generated pre-tax profits of €27.4 million compared with losses of €34 million in 2001. Gross premium income rose from €845 million to €939.5 million.
Despite this return to profitability, the group has again criticised the high level of court awards in Irish personal injury cases relative to other states as well as the incidence of weather damage to property as factors affecting this business.
Yesterday the Irish Insurance Federation (IIF) said the November 2002 floods had resulted in insurance claims of €50 million.
In total some 1,358 insurance claims were lodged of which 1,171 were household claims costing €39 million.
A further 187 claims were for damage to commercial property costing €11 million.
Much of the flood damage affected properties close to Dublin's Tolka river and its tributaries last year.
