Downward trend in technical result swings upward
Across the Dutch non-life insurance market, third-party liability motor insurance has posted technical losses since 2008, and 2018 was no exception (see Figure 1). Technical losses mean premium revenues are insufficient to pay for claims and costs. That said, Dutch non-life insurance firms appear to be regaining control over this highly competitive market. Following a period of ever-increasing losses since 2011, the trend has now reversed. Market-wide technical losses stood at EUR 308 million at year-end 2018, down from EUR 474 million in 2017, with net premiums earned amounting to EUR 2,309 million (2017: EUR 2,148).
Consumers typically take out third-party liability motor insurance together with bodywork insurance for their car or other motor vehicle. In most years, insurance firms achieve profits on bodywork insurance, thereby partly compensating for loss-making third party liability motor insurance. In some years, profitability trends for the two types of insurance diverged, but this was not the case in 2018. In other words, improved technical results for third-party liability motor insurance were not at the expense of those for bodywork insurance.
Figure 1 - Net technical results excluding investment returns by market segment