Half Year Results 2022

I am pleased to report a profit for the first half of 2022. Our focus has been on driving value for our stakeholders and we have made positive progress against this. This is despite the difficult economic backdrop as investment volatility impacts our results. Investment markets had an exceptionally challenging first six months to the year, the increase in inflation and resultant higher interest rates is impacting our returns and reducing the valuation of the FBD bond portfolio. Spreads have also widened which increased bond yields further. A positive side to this is the higher reinvestment yields that will now be available to us in the future.

The Personal Injury Guidelines appear to be having the desired effect of lowering costs for minor injury claims justifying the premium reductions given to our customers. We await the outcome of the remaining challenges to the Guidelines and their application by the courts.

A further hearing is scheduled in our Business Interruption test case in November 2022 to determine the quantification of partial losses in respect of the bar counter and the treatment of Government subsidies.

Our strategic focus on our customers continues as we consider new propositions for loyal customers and to improve our customer experience supported by technology. Research continues to show that customers are loyal for many reasons including our excellent claims experience and value led propositions. We really appreciate the loyalty of our customers and want to continue to deliver increased value for those who stay with us and encourage new customers to switch for value and service.

FBD’s success is dependent on our people including our Claims, Local Offices and Mullingar Service Centre employees who continue to provide incredible personal service to our customers, supported by Head Office. In many cases hybrid working has become a feature of our lives and I would like to thank all our employees who continue to put our customers at the heart of what we do.

The economic conditions in general are challenging as our customers and all businesses face higher inflation impacting purchasing power and more subdued growth rates. Inflation is feeding into the cost of settlement of Motor Damage and Property claims. Market risk will remain high for the foreseeable future, although we expect to benefit from higher yields on bond reinvestment.

It is testament to the great work of our people that customer policy numbers are increasing as we build on our strong customer base and drive more value from the business. There are opportunities and challenges ahead as we tackle increasing inflation and a more challenging economic environment. I am thankful for a supportive Board and strong Executive Management Team with the requisite skills and ambition to deliver on our strategic goals on behalf of all our stakeholders including our employees and customers.