The UK insurance industry has plummeted into the red with claims exceeding income during the fourth quarter of last year.

Long-term insurers have seen claim payouts exceed premiums by £4 billion ($6.1 billion) during the fourth quarter, according to the Office of National Statistics.

Premium income for the quarter was £31.3 billion ($48.4 billion), up £7.7 billion ($11.9 billion), but this was offset by a rise in claims of £4.8 billion ($7.4 billion) to £35.3 billion ($54.5 billion).

Total income and losses for long-term insurers in the quarter decreased by £27.4 billion ($42.3 billion) generating total income of £69.2 billion ($107 billion).

Expenditure for the quarter was £74.2 billion ($114.7 billion); £13.7 billion ($21.1 billion) lower than the third quarter resulting in a loss of £5.1 billion ($7.8 billion).

General insurers’ premium income was £8 billion ($12.3 billion) in the fourth quarter, down £1 billion ($1.5 billion) on the third-quarter figure.

Again claims rose for this segment by £200 million ($309 million) to £6.7 billion ($10.3 billion).

General insurers’ total of income and losses for the last quarter of 2010 was £9.2 billion ($14.2 billion) compared with total expenditure of £12.2 billion ($18.8 billion), creating a £3 billion ($4.6 billion) loss.