Direct Line reports smaller-than-expected claims bill
British home insurer Direct Line Group reported a smaller-than-expected bill for the country's severe winter severe weather, with claims remaining well below analysts' average projection.
The group, which owns Churchill, Privilege and Green Flag, announced that its claims bill for the start of this year to February 22 reached just £60 million (US$101.1 million). Analysts had predicted a bill of £70-£90 million.
Car premium income slipped 10 per cent year-on-year in the first quarter of current year as the insurer encountered extremely competitive conditions in the market. Average car insurance prices slipped 4 per cent, while the number of in-force car policies fell 1.2 per cent to settle at 3.7 million.
Though the group benefited from improved trends in motor insurance, yet the total number of car policies written slipped from 19.4 million to 18.1 million. The decline was partly due to the insurer's reluctance to bring rates down.
Announcing the results, the group said, "The UK motor and home markets are highly competitive. The group will continue to prioritise targeting appropriate margins, even if this is at the expense of policy volumes."
According to the Association of British Insurers (ABI), British insurers only received 17,500 in flood-related claims between 23rd of December and the end of February this year. The figure includes 9,000 home insurance claims, 3,100 claims from businesses, and 5,400 claims for damaged vehicles.