BF&M’s Profits Slip In ‘Weakened Economy’
BF&M Limited today [May 19] announced net earnings for the year ended December 31, 2010 of $17.3 million, resulting in a return on shareholder’s equity of 10 percent which president and CEO John Wight said “represented a decrease from 2009 results of $19.6 million”.
Mr. Wight added that “2010 proved to be a challenging year for Bermuda as the weakened economy which affected businesses and households also affected BF&M’s financial performance.”
Mr. Wight stated: “We were pleased that rating agency A.M. Best maintained their FinancialStrength Rating “A” Excellent for BF&M’s two principal operating companies BF&M Life Insurance Company Limited and BF&M General Insurance Company Limited .
“A.M. Best’s rating system is designed to provide an opinion of an insurer’s financial strengthand ability to meet ongoing obligations to policyholders. Their opinions are derived from an evaluation of a company’s balance sheet strength, operating performance and business profile.”
A. M. Best’s “A”Excellent rating rationale cited “the organisation’s consistently positive net income, steady premium growth, and strong capitalization.”
These “A” Excellent ratings for BF&M Life and BF&M General are the strongest of any local insurer in the Bermuda marketplace, added Mr. Wight.
The company’s balance sheet continues to be very strong. Shareholders equity at December 31, 2010 was $180.5 million. Assets totaled $794.2 million, of which $74.3 million was held in cash and shortterm deposits. Based on the company’s strong balance sheet and financial performance, the board of directors maintained the dividend of 20 cents per share for shareholders of record at March 31, 2011.
Gross Premiums Written for the year increased five percent over 2009 to $235.7 million. Investment income, including the increase in the value of investments held for trading increased 46 percent to $19.5 million. Commissions and other income increased 10% to $26.6 million.
Claims and adjustment expensesincreased by 21 percent to $22.7 million and policy benefits increased 16 percent to $114.1 million. Operating expenses increased four percent to $45.3 million.
BF&M Limited is the holding company of the BF&M Insurance Group. The two largest operating companies within the group are BF&M Life Insurance Company Limited, a leading provider of life, health and pensions products, and BF&M General Insurance CompanyLimited, the leading general insurer providing all forms of property, casualty, motor and marine products.
The group includes several other companies including Bermuda InternationalInsurance Company Limited, Bermuda International Reinsurance Services Limited, Marchmont Insurance Company Limited, BF&M Investment Services Limited, BF&M Properties Limited [including Scarborough Property Holdings Limited and Barr’s BayProperties Limited], Hamilton Financial Limited, and a 51.7 percent interest in the Insurance Corporation of Barbados Limited.
The cupboards are bare ..!!