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Insurer Mapfre's profits fall when pandemic hits business



(Reuters) – The Spanish insurance company Mapfre reported on Thursday a 14% decrease in net profit in 2020, affected by a pandemic-driven increase in medical claims while travel restrictions contributed to a decrease in demand for other insurance products.

the company also predicted that the snowstorm Filomena that hit central Spain last month would lead to losses after tax of between 20 and 25 million euros.

Mapfre shares fell by about 3.5% and were the worst of the 35 blue-chip shares. in the IBEX index, which fell 0.3%.

The insurer said that the pandemic affected car insurance, life insurance and savings as well as travel insurance, even though the demand for health coverage increased.

"As a result of the suspension of the population, sales of new insurance fell, leading to a reduction in premiums," said Mapfre.

It had to pay more than EUR 367 million in claims related to COVID-1

9 mainly in its reinsurance and health insurance divisions.

The company also wrote off EUR 132 million in write-downs from its Italian, Turkish and Indonesian units as operations in these countries are unlikely to recover in the short term.

Mapfre's net profit fell to € 527 million ($ 639 million) in total last year, premiums slipped 11% to € 20.5 billion.

Analysts had an average profit of € 612 million in a Refinitiv survey.

"Overall, negative for the stock because net profit came below consensus estimates," broker CM Capital Markets said in a note to investors.

Mapfres the board plans to ask the shareholders to approve a dividend of 13.50 euros cents compared to the 2020 result, down from 14.50 cents a year earlier.

More insurance and risk management news about the coronavirus crisis here .

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