Hibernian Insurance faces a £9 million bill for storm damage claims following the severe storms over Christmas. The company had estimated that the storms would generate claims of around £6 million, but chairman, Mr Jim Culliton, told the annual general meeting claims had now risen closer to £9 million.
Most of the damage payments would be met by Hibernian's own reinsurers, while it had also made provisions of £2.5 million in its accounts. Chief executive, Mr Adrian Daly, said the exceptionally high storm bill would not affect premiums next year. But, if the situation was to persist, it would inevitably put pressure on premium rates, he said.
Mr Culliton played down speculation that giant international insurer Commercial General Union (CGU) may make a bid for Hibernian. He said the board wished to stress that it had not received any approach from that group in relation to any offer which "may or may not" be made to shareholders. The chairman added that it would be inappropriate for him to make any further comment on a possible bid.
CGU already owns 28 per cent of Hibernian and has close links with Munich Re, which has 11 per cent of the insurance group.
Mr Culliton said the group had enjoyed a strong performance in 1997. Hibernian reported pre-tax profits of £43.2 million, with the board recommending a final dividend of 12.2p per share. In Britain, the company is trying to sell its business base. Mr Culliton said it had received interest from a number of buyers. It had now selected a small number which would be allowed greater access to the business to facilitate them in making an offer.
"On receipt of these formal offers, your board will be in a position to evaluate with which buyer, if any, we will seek to conclude an agreement for the disposal of our UK operation."
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