December 19, 2013

Despite being named Insurance Times General Insurer of the Year earlier this month, flag carrier insurer RSA appears to be going through a slightly sticky patch lately. Maybe you’ve heard about this already? Nah, probably not. So anyway…

RSA are reportedly “hunting” for a new CEO after the previous incumbent Lee Simons opted not to hang around while investors forsook its shares, and sundry commentators slunk about saying unhelpful things like “Some of RSA’s key financial metrics are weaker than its ratings would suggest.”

That comment came from Fitch ratings analysts, who may yet adjust the insurer’s current A rating so that it accurately reflects RSA’s key financial metrics, but they are probably reluctant to start rushing into things.

RSA lead the way on Friday last week as the Footie Index slumped to a two-month low, losing 4.20 points, with RSA’s share price falling a literally whopping 17.3% following a profit warning and Lee Simons’ prudent if somewhat abrupt departure.

Which exotic lines of business are causing these latest problems for RSA? Business Wine reports that: RSA’s Irish reserves “will need to be strengthened by £130m as a result of its recent review. The majority of which relates to bodily injury strengthening in motor and liability lines. This follows the £70m reserve strengthening announced on 8 November relating to claims and finance issues in Ireland.”

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