Direct Line on track as motor premiums stabilise
Direct Line said it remains on track to hit its full-year targets despite "highly competitive" markets, with pricing in the motor insurance market continuing to stabilise in the third quarter.
Direct Line Insurance Group
184.50p
16:35 26/04/24
Group gross written premiums totalled £928m in the three months to 30 September, down 5.1% on the third quarter of 2013.
The company said that all its divisions - motor, home, rescue and other personal lines, and commercial - saw falling sales during the period.
Motor, its largest division, saw premiums fall 5.4% to £365.2m. However, the decline was less than in previous quarters, as "prices were more competitive in a stable market, and the benefits from improvements in pricing and claims capability continued", Direct Line said.
What's more, the fall reflected a 2.5% fall in the 'risk mix' - the expected level of claims from the portfolio - while prices were broadly flat. Motor premium prices fell just 0.1% compared with last year, an improvement from the 2.2% decline in the second quarter and the 4.9% drop in the first.
"Progress in the third quarter means we remain on track to deliver our 2014 financial targets, despite a backdrop of markets that remain highly competitive," said chief executive officer Paul Geddes.
The company reiterated its guidance to achieve a combined operating ratio of 95-97%, assuming a normal level of claims from weather events.