ECONOMY

Insurer sees profits in 2004

Phoenix Metrolife Emboriki, the new entity created from the merger of Phoenix Insurance and Metrolife Emboriki early this year, expects to reap the fruits of its ongoing restructuring program in 2004 when it is projected to return to the black, Giorgos Kotsalos, managing director, said. The company anticipates a loss this year and next, due in part to a voluntary redundancy program costing 23.5 million euros, which has slimmed the work force down by 118 to around 500. The outlay will be spread out evenly over four years. «By cutting down on expenditure, better managing our losses and increasing underwriting business, we should be able to generate a profit in 2004,» Kotsalos said. He said a center to monitor auto claims, to be set up by the end of the year, should improve the company’s loss ratio. Phoenix Metrolife also aims to reduce its expenses/premiums ratio from its current 36 percent to 20 percent over the next two years. Kotsalos said the company does not plan a cash call this year despite suffering heavy losses from equity investments, the result of the fall in the stock market. Phoenix Metrolife had realized losses of 3.5 million euros from share sales in the first nine months of the year, while unrealized losses from its equity holdings amounted to 52 million euros. «We see no need for a capital increase this year,» Kotsalos said, adding that the company might reconsider its stance next year in order to raise funds for expansion. He said the company has sufficient provisions to cover claims despite the drop in equity investments. Phoenix Metrolife posted a 25 percent increase in non-life premiums in the first nine months of the year against a 12 percent rise in life premiums. The launch of two new products, retirement benefits and home cover, is expected to boost sales.