Ecclesiastical suffers $107.2 million pre-tax loss in H1

Interim results include large hit on investment

Ecclesiastical suffers $107.2 million pre-tax loss in H1

Insurance News

By Terry Gangcuangco

Ecclesiastical Insurance Office Plc is the latest to reveal how it fared in the first half of 2020, and the interim numbers show that the specialist financial services group has been dealt a blow.

Due to the impact of the coronavirus crisis on financial markets, Ecclesiastical posted a loss before tax of £59.7 million (around SG$107.2 million) during the January-June period – a plunge from the £42.8 million (around SG$76.81 million) pre-tax profit it enjoyed in the same six-month span in 2019.

Investment losses in the first half amounted to £48.9 million (around SG$87.8 million), while group underwriting loss stood at £1.3 million (around SG$2.33 million). The latter figure, according to the insurer, included £14 million (around SG$25.13 million) for the provision of claims related to the pandemic.

It wasn’t all doom and gloom, though. Thanks to strong retention and rate increases in hardening markets, Ecclesiastical’s gross written premium grew 9% to £202 million (around SG$362.54 million).

Commenting on the results, group chief executive Mark Hews stated: “The first half of 2020 was uniquely challenging due to the significant impact of COVID-19. However, we remain true to our core purpose and have continued to give to church, charities, and communities most in need.”

It was noted that Ecclesiastical, which is part of Allchurches Trust, has now donated more than £97 million (around SG$174 million) to charity since 2016.

“While our headline loss before tax is disappointing, in the main it has been driven by unrealised fair value losses on our investment portfolio,” Hews went on to say. “These are investments that are being held for the long term and on which we have already seen some recovery.

“We expect this to continue over the months and years ahead, and we continue to take a long-term view and look beyond the current pandemic.”

The CEO added that Ecclesiastical’s underlying performance is resilient while noting that they are beginning to see activity returning to normal levels. Additionally, Hews expressed pride in the organisation’s workforce in its handling of the situation.

“We are proud of the way that our colleagues rose to the challenge,” declared the group boss, “and continued to serve our customers throughout this difficult period while themselves adapting to new ways of working.”

Hews also thanked everyone who remains supportive of Ecclesiastical’s work and enables the firm to give to several worthy causes at a time when the need, he said, has never been higher.

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