NFU Mutual posts improved insurance results but overall loss for 2011

NFU Mutual’s insurance business produced an underwriting profit of £105m in 2011 compared with a loss of £150m the previous year.

However, the business as a whole made a loss of £47m after tax and after payment of a £106m bonus to its farmer members.

The rural insurer, pensions and investments organisation saw a 6% increase in premium income to £1,273m and increased the total funds it managed in the year to £12.5bn. Investment performance accounted for much of the group’s losses.

“The loss after tax of £47m was largely driven by unrealised losses on our equity portfolio, but the group’s financial strength enables it to absorb these fluctuations with the objective of achieving higher returns over the long term,” said Lindsay Sinclair, group chief executive.

Market share had been maintained, with the group achieving a general insurance renewal rate of 94% in difficult market conditions.

The group provides £190,000 in financial support for police units working to reduce rural crime and works closely with farming unions to raise awareness of farm safety.

The NFU Mutual also supports rural life and the countryside in other ways – it contributes £6m a year to the running costs of the National Farming Unions, gives more than £320,000 to rural charities via The NFU Mutual Charitable Trust, funds six postgraduate agricultural students through its Centenary Award scheme and supports the Business In The Community Prince’s Rural Leadership Team.

The group won several awards in 2011, including coming Top of Which? Recommended Provider lists for home and car insurance, six Moneywise magazine readers’ awards, Britain’s Best Car Insurance Provider Auto Express award for the sixth year in a row. It was also named Best Life Insurance Provider at the Personal Finance Awards.

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