WorkSafe Victoria almost doubled its insurance profit for the six months to December 31, but poor investment returns ran it into a net loss.

The Victorian workers’ compensation body reported that its performance from insurance operations – the key measure of financial performance – returned $118 million, compared with $61 million in the corresponding period in 2010.

But it made an after-tax loss of $641 million compared with a profit of $396 million.

CEO Greg Tweedly says the scheme is fundamentally strong but has suffered from sluggish investment markets and lower interest rates.

WorkSafe reported a record low rate of worker injury, at 10 injuries per 1000 workers, down from 10.49 in the previous corresponding period.

Better health and safety results and improvements in claims management enabled a $10 million actuarial release, a writedown of liabilities when projected claims costs can be reduced.

But Mr Tweedly warns of common law liabilities rising from $2.1 billion to $2.4 billion.

“The deterioration was largely driven by the actuaries’ recognition of increased lodgements of common law claims, particularly those at the lower end of the serious injury spectrum,” he said.

“Should this trend continue, the actuaries have indicated strongly that there will be further increases in liabilities in future valuations.”

WorkSafe’s funding ratio, comparing assets against liabilities, fell to 97% from 106%.