Ansvar Australia has renegotiated its reinsurance, entering a quota-share arrangement, according to Acting CEO Deirdre Blythe.

She says the company has completed its transformation, quitting personal lines to concentrate on the core business of faith, heritage and community, and is now positioned for growth.

“We have been on a journey back to sustainable profitability,” she told insuranceNEWS.com.au.

Ansvar made an underwriting loss of £4.2 million ($7.54 million) last year compared with a £5.2 million ($9.34 million) loss in 2012, its parent company, Anglican Church-owned insurer Ecclesiastical, reported last week.

Ecclesiastical says Ansvar’s underlying performance “improved substantially” and it is expected to return to underwriting profitability this year.

It says Ansvar’s cost of reinsurance remained uneconomically high last year following 2011 catastrophes such as the Canterbury earthquakes, and it has entered into a 100% quota-share deal for its property insurance, starting this year.

Ansvar reported a 30% fall in gross written premium to £45.7 million ($82.09 million) as it quit personal lines and reduced catastrophe risk exposure.

Ms Blythe says reducing risk has made negotiating with the reinsurance market much easier.

Ecclesiastical reported a profit of £62.12 million ($111.58 million) last year, up 125% on 2012 after restructuring several businesses.

Its combined operating ratio (COR) was 102.9% compared with 108.5% the previous year. Australian operations had a COR of 114.8%, compared with 122.1%.