Ageas 2016 profit plummets as Fortis settlement provision hits

A €894 million provision for the Fortis settlement impacted Ageas' 2016 results, driving group full-year net results down to €127 million from €770 million in 2015.

Ageas, the insurer left over after the collapse of Dutch-Belgian financial group Fortis, agreed in March 2016 to settle all outstanding Fortis legal claims for 1.2 billion euros. Following the events in 2007 and 2008 related to Fortis, Ageas has been involved in a series of legal proceedings in Belgium and the Netherlands in which it faces a number of more or less similar claims for damages.

Ageas CEO Bart De Smet said: “2016 has been an eventful year for Ageas marked by the sale of Hong Kong, the acquisition of Ageas Seguros, the launch of activities in the Philippines and Vietnam, and the Fortis Settlement. A court decision to declare the settlement binding that is expected by mid- 2017, would bring to a close a difficult period for the people concerned and for the Group as a whole.

In 2016 Ageas’ combined ratio was 98.7 percent, a slight increase from 96.9 percent in 2015. Total gross inflows, which include non-consolidated partnerships, were up 6 percent year on year at €31.65 billion in 2016.

"At an operational level, all segments, with the exception of the UK, achieved very good results. In the UK a number of exceptional events forced the Group to take significant one-off charges for restructuring and reserve strengthening partly in anticipation of changing regulations. Unfortunately these events also prevented us from realising the combined ratio target set out as part of our Ambition 2018 strategy."