Promina Group’s first-half profit fell 5.7% and net income fell to $216 million, compared to the $229 million achieved in the corresponding period last year.

The results, announced this morning, show the company’s insurance sales rose 7.8% to $1.73 billion as it cut premiums to build market share. Its insurance margin fell to 8.9% from 11.4% as claims increased, but the figure is lower than the anticipated full-year target of 10%.

CEO Mike Wilkins says it’s “an exceptional result in a general insurance sector that has been particularly affected by a competitive pricing environment”. He is forecasting at least 5% annual growth in sales through to 2008.

The cost of Cyclone Larry was $47 million, with snowstorms in the South Island of New Zealand costing $9 million.

Mr Wilkins says Promina has continued to grow shareholder value in a tightening and increasingly competitive market. “Evidence of this is clear from the group’s continuing market share gains in all personal lines of general insurance, and from revenue improvements in the intermediated business,” he said.