6/06/2005, Assetinsure announces strong profit
SYDNEY, June 6, 2005. Specialist general insurance company Assetinsure today announced a profit of $14.8m before tax and $11.9m after tax for the 2004 business year, the company’s first 12 months of operation under new ownership and management. Shareholders’ funds now amount to $85.2m.
CEO, Mr Peter Wedgwood described Assetinsure’s initial result as “very positive and confirming our business model which is to start up a general insurance business without being a greenfield operation”.
Assetinsure entered the Australian general insurance market by purchasing all the shares of Gerling Global Reinsurance Company of Australia Pty Limited (GGRA) from the Group in Germany. The acquisition was completed on 1st September, 2003. While Assetinsure is discharging the liabilities resulting from GGRA’s reinsurance book, there is no ongoing reinsurance business. New general insurance activities commenced on 31st March, 2004.
A number of factors contributed to the company’s strong result:
- The reinsurance book continued to run off in a positive way. The company paid out $61m in reinsurance claims in the year 2004 and reduced its open claims files count by approximately one-third.
- Sound new business opportunities were secured in Professional Indemnity (PI), Property and Construction. In PI, about 50% of all risks in Assetinsure’s portfolio were previously written overseas, thus positioning Assetinsure as an attractive local service alternative.
- Assetinsure enjoyed investment income well in excess of budget in 2004. Results were enhanced by the decision to restructure the investment portfolio shortly after the change of ownership and the company having access to the expertise of Babcock & Brown.
As a result of the above, the solvency ratio stands at 2.15, placing Assetinsure at the upper end of the industry’s capitalisation levels. Assetinsure’s entry into the market was also supported by leading and strongly capitalised reinsurance companies providing capacity to Assetinsure on the basis of its solid business model and the experience of its operatives.
Assetinsure has now established a distribution network comprising of all international insurance brokers, plus some specialist intermediaries having a strong position in either a particular state or a special product area.
COO, Mr Gregor Pfitzer says: “Assetinsure has recognised that general market conditions have softened in various areas. So it is crucial for the company to work on its service orientated product propositions and actively promote such opportunities. After one year in the market and demonstrable portfolio experience, this is becoming an easier task.”
About Assetinsure
Assetinsure is an Australian-owned company that brings additional choice to the Australian insurance market through the provision of specialist insurance products such as Professional Indemnity, Directors & Officers, Property, Construction and Financial Risk. The company is owned by Assetinsure Holdings which is backed by Babcock & Brown (50%), Asset Underwriting Group (25%) and other private investors (25%). For more details and financial information please visit the website, www.assetinsure.com.au.
For more information
Peter Wedgwood
Chief Executive Officer
Assetinsure Pty Limited
T: (02) 8274 2826
Gregor Pfitzer
Chief Operating Officer
Assetinsure Pty Limited
T: (02) 8274 2832
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