Insurers’ profits down 15%

Insurance companies that are supervised by the ASF (Portuguese Authority for the Supervision of Insurers and Pension Funds) says the total profits for the sector have fallen 15%.

The insurers posted total net profits of €822 million in 2022 according to a report issued by the entity.
However, only one company, the insurer Vida GamaLife explains much of the results having achieved exceptional results as a result of an operation linked to its investments in Italy.
GamaLife enjoyed profits of €311 million, almost 40% of the entire profits from the sector. Excluding this company, the other 36 insurers with headquarters in Portugal suffered a overall 15% fall in their profits in 2022.
The fall was down partly to technical results* or current insurance activity (-23% without Gama Life), and a fall of 9% in Non-Technical results – meaning those derived from investments in financial markets and others.
All told, net results stood at €822 million (€510 without GamaLife). Technical results stood at €1.5Bn and non-technical results at €323 million (Just €9.8 million without GamaLife).
All these indicators result from an increase of 27% for the sum of the net results of the 37 companies (-15% without GamaLife), with a fall in technical results of 36% (-23%) and an increase of 910% in non-technical results (-6%).
Own capital posted a fall of 29% from 2021 to 2022, explained by companies needing to use their capital reserves to bolster their provisions against the instability of interest rates and the potential devaluation of assets with fixed rate calculated income.
Whilst GamaLife overshadowed the rest of the market by its extremely good results, other companies that did well include Ocidental Vida, Aegon Santander Vida and Não Vida, CA Vida, Planicare, Real Vida, Fidelidade and Tranquilidade/Generali.
Allianz also stood out for its profitability to capital while Zurich only made the list because of Life since all the other Non Life operations are with Zurich Insurance Plc, a subsidiary of the Swiss insurer based in Ireland.

*Technical Result means Premiums Earned on own account less claims costs and operating expenses on own account, plus the allocated investment return transferred to the technical accounts and other technical income.