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General Insurance Premium Income of £1.330bn (2013: £1.288bn)
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Combined Operating Ratio of 87.8% (2013: 89.9%)
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Underwriting profit £150m (2013: £120m)
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Profit for the year of £413m (2013: £635m)
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Life Annual Premium Equivalent[1] of £48m (2013: £45m)
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Growth in total funds under management to £15.9bn (2013: £14.8bn)
On the General Insurance side of the business (motor, commercial and personal insurance) premium income continued to show good growth, increasing from £1.288bn in 2013 to £1.330bn in 2014.
Not withstanding the difficult market conditions, the company achieved an underwriting profit for the fourth year in a row. Its overall profitability, as measured by the business’s Combined Operating Ratio, ended the year at 87.8%.
Overall profit for 2014 was £413m including investment income and unrealised gains on investments. Equity returns have been more modest than in previous years, reflecting the story of the markets in which we invest, while the performance of the property portfolio has been excellent.
On the Life side of the business, 2014 saw a host of challenges in the external environment but was a still a year of strong performance for NFU Mutual’s Life sales with Annual Premium Equivalent (new regular annualised premiums plus 10% of new single premium) growing from £45m to £48m.
The Group’s total Life funds under management grew from £8.9bn to £9.5bn and, as with the business’s General Insurance business, NFU Mutual continues to maintain a strong solvency position.
Lindsay Sinclair, Group Chief Executive, said:
“We saw an uncertain start to the year with wind, storms and flooding causing havoc to many of our members, signifying the longest period of continuous severe weather seen by NFU Mutual in over 100 years.
“We’ve been supporting our members every step of the way in making a good recovery from the impact and damage caused by the flooding, and at the end of the year we had paid out more than £81 million for flood and storm damage.
“Our agency network and staff were quickly out in force on the Somerset Levels, helping members with emergency payments and supplies and it is at times like this that the value of our local, personal service really comes to the fore.
“This dedication to customer service is recognised not only by our customers but by major consumer organisations as well, and we were very proud to be named Which? Best Insurance Services Provider – a new category in 2014, as well as a Recommended Provider for car and home insurance for the ninth time in a row.
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