Migdal seals insurance industry reports with huge quarterly loss of NIS 1b

The company ended the first half of the year with a loss of NIS 712 million, compared to a profit of NIS 567 million.

 Migdal Insurance and Financial Holdings Ltd (photo credit: Wikimedia Commons)
Migdal Insurance and Financial Holdings Ltd
(photo credit: Wikimedia Commons)

Migdal Insurance and Financial Holdings Ltd. closed the season of negative financial reports for the insurance industry with a quarterly loss of approximately one billion shekels, compared to a profit of 334 million shekels in the same period in 2021. 

The company ended the half year with a loss of NIS 712 million, compared to a profit of NIS 567 million. Migdal Insurance is managed by Sagi Yogev and the chair of the board is Yiftach Ron-Tal.

The loss is mainly due to a one-time adjustment of approximately NIS 923 million, which was caused by updating mortality tables, a key index in the insurance industry, and negative returns in the capital market which led to investment losses of NIS 2.6 billion. 

On the other hand, an increase in the interest rate curve reduced insurance liabilities by NIS 2.1 billion. Migdal manages assets of NIS 379 billion, the highest in the Israeli insurance industry. 

Premiums and benefits increased by 14% to NIS 13.1 billion. Premiums in general insurance decreased by 16% gross.

 HANAN MELCER:  controlling shareholder in Migdal Insurance and Financial Holdings Ltd (credit: MARC ISRAEL SELLEM) HANAN MELCER: controlling shareholder in Migdal Insurance and Financial Holdings Ltd (credit: MARC ISRAEL SELLEM)

Underwritten profits amounted to NIS 330 million compared to about NIS 461 million in the same period in 2021. There was an increase in all areas of activity except for the car industry. Yogev stated that the company is examining the possibility of entering into new activities, and said that Migdal might enter the field of credit cards

He added that in the second quarter, the company was challenged by negative returns in the capital market and updating mortality tables. Since the end of the quarter, the capital market has recovered, which has led to an increase in managed assets and an improvement in returns for the partners.