Like AMP, NRMA is looking at its options on how to handle the area it’s least experienced in. Unlike AMP, it’s financial services that NRMA is least comfortable with.

Announcing a dramatic drop in profit in the six months to last December 31, MD Eric Dodd said NRMA’s asset management arm may be restructured and a large part of its work outsourced. Under such a scenario, NRMA would become a “manager of managers”, Mr Dodd said.

Thanks to plummeting returns from equity markets, NRMA’s second-half profit plunged to just $3.4 million, but its actual insurance results were encouraging.

The leading general insurer’s prospectus result for the year to June 30 2001 is in all likelihood out of reach. NRMA’s investments actually lost the company $34 million, down from a $326 gain in the corresponding 1999 period.

But insurance profits increased a whopping 62% to $102.5 million for the six months, on gross premiums of $1.421 billion – a growth of 17%.  The combined ratio dropped from 103.5% to 102% as the company concentrates on its claims and expenses.

Those figures prompted analysts to hail the company’s medium-term prospects as very positive. Also well received was the announcement that NRMA will launch an off-market buyback of 10% of its shares. That is likely to decrease the influence of “mum and dad” investors on the company, and may even assist in stabilising its fractious board.