RSA Insurance Reports Market Improvements

UK branch of one of the world’s leading insurance companies – RSA Insurance – recently reported a 4% increase in insurance premiums seen in the 9 months of 2009.
RSA Insurance, previously known as Royal & Sun Alliance, posted net written premiums of £5.03 billion pounds. The firm also claimed that its business is recovering on international and emerging markets even though trading environment remains difficult. According to Mr. Andy Haste, chief executive of RSA Insurance, the company is seeing improvements in certain markets as growth of its net written premiums on international and emerging markets totaled to 8% and 7% respectively, despite a 3% decline on the UK market.
However, the UK insurance market, in which RSA Insurance has great trust, showed significant improvements in terms of personal and commercial insurance; UK car insurance rates also grew by 7%, signifying market recovery for RSA and a 14% year-on-year increase in car insurance cost for consumers.
The news is, yet, good for RSA Insurance, which is best known in Great Britain for its home and car insurance; the firm’s management said RSA will definitely hit its target of 95% operating ratio in 2009, which means that the business will generate profits this year (anything under 100% is profitable).
Meanwhile, investors are not extremely positive about the future of RSA Insurance: the company’s shares decreased by 9% in the past month and are currently being traded almost at 12-months lows. The negative change occurred as RSA revealed its plans associated with issuance of new rights for $1 billion and acquisition. UK investors claimed that RSA Insurance has to come up with a concrete set of acquisition plans if it wants rights issuance to be approved.