Irish Life to buy Boston firm

IRISH Life, the Republic's largest insurance company, has agreed to buy the Boston-based First Variable Life for dollars 50m-dollars 55m ( pounds 35m- pounds 38m), and has announced pre-tax profits for the year to 31 December 1993 up slightly from Ir pounds 40.4m to Ir pounds 41.9m.

Irish Life said it expected due diligence procedures on the purchase, from the US company Monarch Life Insurance, to take about two months. First Variable specialises in selling variable annuities and has assets of dollars 350m. Irish Life's existing US life assurance subsidiary, Interstate, enjoyed a record sales year with new business of Ir pounds 94m, up by nearly half on 1992.

Irish Life's managing director, David Kingston, said the US operations have been a success and account for 16.5 per cent of premium income. The group is looking to make acquisitions in Ireland and the US, and more American deals may be on the way.

The group said it achieved satisfactory sales in the UK. Overall sales, boosted by a stronger sterling, rose 17 per cent to Ir pounds 48.1m. Sales of single-premium business grew by 28 per cent to Ir pounds 33.9m. Overall sales in Ireland, accounting for more than two-thirds of business, rose 15 per cent to Ir pounds 174.1m in 1993.

High interest rates and an uncertain outlook in Ireland depressed sales in the early months of 1993 but sales recovered as interest rates fell and equity markets moved ahead later in the year, the company said.