Cover-More has vowed to lift its game and accelerate its expansion in North America after net profit fell 27.5% to $18.7 million for the year to June 30.

Pre-tax earnings dropped 14.2% to $44.6 million, weighed down by a first half that experienced turbulence on many fronts, including Bali volcanic ash disruption and higher claims costs.

Net travel insurance sales fell 0.6% to $155.9 million, but net medical insurance sales increased 1.1% to $66.7 million.

“Without doubt… earnings were disappointing,” Group CEO Mike Emmett said.

He says “further action is required to improve profitability”.

“Over the coming half-year, we anticipate continued growth in Australia and overseas as we focus on building new partnerships and extending the success of our existing joint ventures,” he said.

“We know we cannot be complacent about our partnership relationships and are proud of the depth and tenure of many of these.”

Mr Emmett, who took over last month from Peter Edwards, says his first seven weeks running the travel insurer have given him reason to be upbeat.

“The relationships with major partners are healthy and good opportunities exist to grow within the Australian travel insurance and medical assistance markets. There is significant interest from a number of participants in the market to become our underwriting partner and sufficient indication that these will be on a satisfactory commercial basis.”

Advanced talks are under way to extend Cover-More’s North American footprint to Canada – a travel insurance market worth $US2.2 billion ($2.9 billion).

Cover-More entered the lucrative US market, the world’s largest, in May under a partnership with Aon Affinity Travel Practice and Flight Centre USA.

This month it named Berkshire Hathaway Travel Protection as its underwriting partner for all direct insurance products sold in the US.

“It is anticipated that Cover-More’s US operations will become a significant contributor to the travel insurance business by volume in the group,” the insurer said.