BF&M announces $0.7 million rise in net earnings

WEDNESDAY, SEPTEMBER 14: BF&M’s fortunes appear to be on the rise, with increased earnings for the first half of 2011.

The insurance company announced net earnings of $11.4 million for the six months to June 30 — a 12 per cent return on shareholders’ equity.

Last year the net earnings were $10.7 million for the six-month period.

Strength

John Wight, BF&M president and CEO, said: “We were satisfied overall with the company’s financial results given the current economic climate in Bermuda, which is very challenging for many of our policyholders.”

AM Best has reaffirmed financial strength ratings of A (Excellent) to BF&M’s two principal operating subsidiaries, BF&M General Insurance Company Ltd and BF&M Life Insurance Company Ltd.

Mr Wight said: “There is no insurance company in Bermuda writing domestic insurance business with ratings this strong.

“AM Best cited BF&M’s ‘consistent positive net income, steady premium growth, high level of capital, and strong market share’.”

Equity attributable to owners at June 30 was $175.3 million.

Assets totalled $838.2 million, of which $67.2 million was held in cash and short term deposits.

A company spokeswoman said: “Based on the company’s strong balance sheet and financial performance, the board of directors maintained the dividend of 20c per share for shareholders of record at September 30, 2011.”

Expenses

Gross premiums written for the six months to June 30 showed an increase of six per cent over 2010, to $130.6 million.

Investment income increased three per cent to $9 million. And the fair value of assets classified as held for trading, increased earnings by $2.4 million.

Commissions and other income increased by seven per cent to $11.4 million.

Claims and adjustment expenses decreased by 16 per cent to $10.9 million, and policy benefits decreased 14 per cent to $51.3 million.

But operating expenses increased by 21 per cent to $25.5 million.

A BF&M spokeswoman said this was “due to several one-time expenses that are not expected to recur in 2012”.

BF&M Ltd is the holding company of the BF&M Insurance Group. The two largest operating companies within the group are BF&M Life Insurance Company Ltd (life, health and pensions products), and BF&M General Insurance Company Ltd (general insurance for property, casualty, motor and marine products).