International and local competition as well as claims in vehicle and medical insurance has led to a 6.5 per cent increase in gross premiums this year compared to 2011 for Bahrain National Holding (BNH), its chief executive said.

"We are very satisfied with the overall performance, given challenging conditions in the insurance markets," said Mahmood Al Soufi.

"Gross premiums increased significantly compared to 2011 and investment performance was steady. Considering the high claims in motor and medical insurance and fierce competition from local and international companies, the company's overall performance was good."

The insurance and risk solutions management company announced its mid-year financial results yesterday.

The underwriting profit was lowered by 63 per cent, mainly on account of claims which increased by 27.9 per cent. Net earned premiums grew 7.7 per cent compared to last year.

Investment income declined by 13.5 per cent which the company said was due to an impairment on an investment made last year worth BD100,000 ($266,951).

The group reported a net profit of BD900,000 which was 45.9 per cent lower than last year. Total assets increased by 3.3 per cent.

The group's subsidiary Bahrain National Insurance (bni) reported a net profit of BD1.1 million.

Gross premiums increased by 2.3 per cent while net earned premiums grew 4.3 per cent compared to last year. The underwriting profit declined by 45.2 per cent.

Higher spare parts and labour costs led to a 30.2 per cent increase in claims. Investment income fell by 28.2 per cent due to lower profits booked on sale, the company said.

The subsidiary's profit declined by 37.4 per cent which the company stated was on account of claims and impairment of investments. Total assets increased by 4.8 per cent.

Bahrain National Life Assurance (bnl), one of BNH's subsidiaries, registered a net profit of BD40,000 which was 57.3 per cent lower than the previous year.

Gross premiums increased by 24.7 per cent while net earned premiums grew by 17.5 per cent compared to last year. The underwriting profit remained low as claims increased by 23.5 per cent.

Investment income rose 46.9 per cent compared to last year. – TradeArabia News Service