Ageas, a Belgium based insurance company, is predicting financial gains in 2011 after experience severe declines in profits in the previous year. The company cites the sale of its non-core businesses and clever investments in growing sectors as key contributors to improved financial performance this year. Ageas operates as AG insurance in Belgium and provides insurance to Tesco, the prominent supermarket chain in Britain.
The insurer reports that earnings on life insurance fell by 9% in 2010. This is due, in part, by a tax benefit established in 2009. Non-life profits plummeted due to the escalating number of auto claims due to severe weather conditions at the end of 2010.
Overall net profit from insurance declined as well by more than a quarter, falling to $366.2 million. The decline in profits met the estimates predicted by the company.
Profits last year were largely influenced by the judicial drama surrounding Fortis Bank. Ageas emerged as an insurance company after the break-up of the Fortis Group. The Dutch government dissolved Fortis in 2008 after a 11.2 billion euro bailout failed to revitalize the group. Ageas was the target of a negative, non-cash charge in relation to the legal disputes.
CEO of Ageas, Bart de Smet says that he expects the company to perform better commercially than it has in 2010, barring events beyond its control.
