During the year, we implemented significant premium increases across most portfolios, better risk selection and pricing, and tightened commercial underwriting disciplines. As a result, our performance has shown some improvement in the second half, despite the challenging economic climate.

This is reflected in our results with gross written premium up by 4.4% in local currency terms in the 2009 financial year. This growth was driven across all businesses, with State delivering 5.5% growth in gross written premium, 4.9% for NZI and moderate growth for Business Partners.

After disappointing losses in the first half of the year, we delivered a small profit in the second half to end the year at break even. A focused effort to manage controllable expenses kept our costs down.

In our direct business, under the State brand, the technology platform launched last year is now enabling more granular risk selection and risk based pricing. Communication tool-kits and proactive media activities were developed to help staff and customers understand the reasons for price increases.

State online, which was launched in January for private motor vehicle insurance, allows customers to obtain a quote and buy car insurance in three simple steps. Early results indicate that this will be a successful sales channel for State.

In our intermediated business, the NZI brand—which is New Zealand's oldest insurance brand—celebrated its 150th anniversary. NZI has continued to lead the market with active re-pricing of its business, with a particular focus on responsible rate increases in the poor performing zones and distributor channels. Retention initiatives were developed to support brokers in educating customers about pricing increases. An innovative technology system that offers brokers full life-cycle policy management capability was also launched in a trial phase.

Significantly, NZI was again awarded the Insurer of the Year from the Insurance Brokers Association, and has now held this award for three of the last four years.

Our Corporate Partners channel developed a market-leading technology application, which integrates a banking partner's customer management system with our core insurance system to simplify the sales process, reduce customers' waiting times and allow banking staff to sell and service insurance more efficiently.

A financial year-end highlight—and visible proof of our sustainability commitment—was the relocation of 700 of our people into the NZI Centre, Auckland's newest green building.

Looking ahead, the challenge is to manage through the headwind of the recession in New Zealand and continue to build on the momentum we generated in the second half of 2009 to deliver a stronger performance in the 2010 financial year.

Our gross written premium growth and insurance margin are expected to improve as benefits are realised from hardening insurance rates and focused business initiatives.