Financial services specialist ClearView has reported an after-tax profit of $2.9 million, for the six months ending December 31 – up 709% compared to the corresponding period in 2009.

Its life insurance new business sales remained static for the six months at $1.1 million – the same figures as the July to December 2009 result. Net premium inflows were $18.7 million for the December half year.

The company now has $41.3 million of inforce life insurance premiums with 60,500 clients.

This delivered a reported after-tax profit on life insurance sales of $2.7 million, but ClearView’s financial planning arms delivered a $1.2 million loss which dragged down the group’s profitability.

MD Simon Swanson says life insurance claims and expenses are within expectations, although lapse rates turned out to be worse than expected.

“We expect [lapse rates] to normalise during the second half of this financial year,” he said.

The unbundling of the financial planning arm’s fee structure ahead of Federal Government changes next year did impact on profitability, he says.

But ClearView has no debt, and its surplus capital in excess of regulatory requirements has risen to $54 million, up $9 million from June 30 last year.

Mr Swanson says if new capital requirements are implemented at the end of this year, the company will not have a problem with meeting them.

“We are now focused on the growth initiatives that we have started and will continue in the second half of the financial year,” he said.

These include upgrading life insurance products and widening the distribution base to include sales through Bupa Australia and credit unions as well as the independent adviser market.