Formerly known as Quindell, Watchstone said Ingenie was affected by the reduction in the Ogden discount rate, which unsettled the young driver insurance market.
An impairment of £5.6mln was made to the 2017 numbers to reflect the reduction in future profitability, though revenue at the division rose to £14.4mln.
Healthcare is based in Canada and comprises clinics owner ptHealth and software group Innocare. Revenues here rose by 6% with an underlying profit of £0.7mln.
Group sales for the year were £44.8mln (£43.6mln) with a loss of £4.95mln (£3.4mln).
Watchstone is still overshadowed by the legal action stemming from the sale of its professional services business to Slater & Gordon.
The Australian law group is seeking £637mln in damages after writing off the entire cost of the acquisition. Watchstone insists there is no merit to the Slater & Gordon claim.
The company, which is also under investigation by the Serious Fraud Office over its accounts, increased its legal dispute provision by £2.93mln during 2017.
Shares were unchanged at 100p.