Strong competition pushed the insurance earnings of Perth-based conglomerate Wesfarmers down slightly over the first half of 2005/06. The company, which owns Wesfarmers Federation Insurance and Lumley General Insurance, recorded an increase in gross written premiums, but this didn’t translate into higher profits.

The group’s insurance division recorded $63.5 million in earnings before tax or interest over the six months. This was down slightly on the $66.2 million earned in the first half of 2004/05.

The rural giant underwrote $502 million of insurance business, compared with $486.8 million in gross written premium last year.

While the insurance division was hit by competition and discounting, the wider Wesfarmers business reported a $447.48 million net profit for the first half and is predicting its full-year result will easily exceed that of the previous year.