Insurer FBD has reduced its estimate of costs arising from a 2021 High Court ruling on business-interruption insurance.
In its half-year results, the insurer said that it now expected the issue to cost it €27 million – down from an estimate of €42 million six months ago.
The 2021 case involved four pub owners, and the court ruled that they were entitled to be compensated under their policies for the disruption caused by COVID-19 restrictions.
FBD had reached agreement with two of the four pub owners, but had been awaiting a further High Court ruling, delivered earlier this year, before finalising the remaining claims.
For the first half of the year, FBD reported pre-tax profits of €39 million – up from €3 million in the same period last year. Its insurance revenue – measured by gross written premium – rose by 7.3%.
It has announced a special dividend of €1 per share.
The insurer’s average premium increased by 4.6% across the portfolio, “reflecting the inflationary impacts from the economic environment”.
Private motor premiums increased by 1.7%, which FBD blamed on the increasing cost of damage claims due to the higher cost of repairs.
Home insurance premiums jumped by 9.5%, due to increases in property sums insured amid higher construction costs.
Commercial-business premiums increased by 5.9%, with FBD saying that customers had increased their liability cover, while farm premiums were up 5%.
Claims increased by €4.5 million to €114.7 million, due to inflation and increased frequency in property and motor-damage claims, according to FBD.
The company said that the average cost of injury-claims settlements had fallen by 5% in the last 12 months and continued to be lower than the pre-COVID figures.
“Court backlogs are easing, with trial dates now secured within pre-COVID timeframes,” it said.
FBD said that claims being settled under the new Personal Injury Guidelines continued to be more than 40% lower in value when compared to the previous Book of Quantum.
It added that an improvement in the level of acceptance of Personal Injuries Resolution Board (PIRB) awards across the market should reduce the number of cases through the courts system.
The insurer warned, however, that it could take a number of years for the full impact of the new guidelines to be known.