Insurers Aviva Plc and RSA Insurance Group Plc shrugged off any fallout from the Brexit referendum by reporting higher first-half profit and increasing shareholder payouts. The shares rallied in London trading.

Aviva, the U.K.’s second-largest insurer, posted a 13 percent increase in operating profit to 1.33 billion pounds ($1.77 billion) and lifted its dividend 10 percent to 7.42 pence a share, according to a statement Thursday. RSA’s operating profit for the six-month period jumped 20 percent to 312 million pounds and the dividend was lifted 43 percent to 5 pence.

“Aviva’s strong financial position and diversity mean we are well insulated from external events,” Chief Executive Officer Mark Wilson said in the statement. “We are delivering consistent, stable and predictable growth despite challenging market conditions.”

Shares of British insurers slumped after Britain’s shock decision to leave the European Union raised concern that the industry’s $2.6 trillion of investments maybe jeopardized. Both Aviva and RSA said their business models were largely insulated from the vote with minimal impact on operations.

Shares Climb

users_iqjWHBFdfxIU_i3B5hgQG6Vm0_v1_-1x-1Aviva, which offers both life and general insurance, was up 4.9 percent at 403.7 pence by 10:12 a.m. in London, trimming its loss since the Brexit vote on June 23 to about 9 percent. Shares of RSA, a general insurer, were up 1.5 percent at 506 pence, extending their gain since the referendum to about 5 percent.

Aviva’s operating profit was lifted by a 20 percent gain in its life-insurance business to 1.23 billion pounds, largely because of contributions from Friends Life Group Ltd., which it bought for about $8 billion in 2015. The insurer’s Solvency II capital ratio was 174 percent at the end of June compared with 180 percent in March.

Aviva Investors, the company’s investment unit, increased profit 48 percent to 49 million pounds as funds under management climbed to 319 billion pounds. The firm reported net inflows of 1.7 billion pounds despite the referendum and saw another 1.5 billion pounds off assets transferred from Friends Life.

In general insurance, Aviva’s operating profit dropped 17 percent to 334 million pounds after higher weather-related claims from Canada’s wildfires, floods in France and a 23 million-pound Flood Re levy. The combined ratio rose to 96.2 percent from 93.1 percent. A measure below 100 equals profitability.

Abandoned Takeover

RSA logoRSA, which was the subject of an abandoned 5.6 billion-pound takeover bid from Zurich Insurance Group AG last year, saw its combined ratio fall to 94.3 percent from 96.4 percent even after 59 million pounds in claims losses, including from the Alberta wildfire in Canada.

CEO Stephen Hester said RSA’s turnaround phase is now completed, with all main business reporting a profit and the company on track to meet “ambitious” 2018 targets. With 75 percent of operating earnings generated outside of the U.K., the depreciation of the pound since Brexit is expected to boost profit in the second half and further increase the dividend, Hester said.

Topics Carriers Profit Loss Europe