Perth-based Wesfarmers Insurance has achieved operating revenue of $1.12 billion and earnings before interest and tax of $124.8 million for the 2005/06 financial year. Operating revenue was down slightly on last year’s result of $1.13 billion.

The group’s divisional insurance margin – incorporating Lumley Australia, Lumley NZ and Wesfarmers Federation Insurance – was 14.9%, with a combined operating ratio of 88.1%.

All businesses recorded strong results despite an increase in competition and margin pressure due to a rise in claims ratios after Cyclone Larry and bushfires in the Grampians in western Victoria.

Wesfarmers MD Richard Goyder says the weaker market conditions resulted from increased competition and a return to more normal loss ratios, effectively reducing earnings by 8%.

“We had a reasonable result in terms of retention of clients, although prices were under pressure,” he said.

Mr Goyder says the company continues to look at several growth initiatives across the division.

“We have acquired some small portfolios within Lumley General Australia, and Wesfarmers Federation Insurance continues to form strong alliances particularly in regional areas.”