Generating Value

We use a multi-brand, multi-product and multi-distribution channel business model, aiming for each of our brands to offer a specific proposition to a distinct customer segment. We believe that this approach, when combined effectively with our significant scale, should help us achieve high performance in distribution, pricing, claims and cost. In turn, this enables us to aim to generate value for customers and sustainable returns for our shareholders.

Business model diagram

Our business model starts with our customers, whom we aim to keep at the core of what we do. We aspire to give them the products that best suit their needs and encourage them to expect a high quality of service throughout their relationship with us. We also strive to be a business that can adapt to their changing needs. We treat each phase of the customer journey as an opportunity to provide an excellent service and outcome from the moment customers select our products, through to the time they make a claim or need to resolve an unexpected event.

Everyone - from front-line staff, who interact directly with our customers, to our people in support and central functions, who run the processes that support our products and services - plays a part in ensuring we are meeting customers’ needs. Without our people, we could not generate value for our customers and sustainable returns for our shareholders.

We seek to ensure that our business is well governed and controlled. We aim to manage our finances carefully by spending money on items that add the most value to our customers, balancing this with the need to generate a suitable and sustainable return to our shareholders.

We hold assets in excess of our expected liabilities in the form of capital, which is designed to absorb unexpected losses that might occur, as well as to meet regulatory capital requirements.

We have a conservative approach to reserving and this may result in significant prior-year reserve releases.

Our shareholders form a crucial part of our business model by investing in us, in the expectation of achieving a return. We aim to deliver value for our shareholders by sustaining the generation of business profit, which is reinvested in the business or distributed to shareholders in the form of dividends.

We ensure that our products meet regulatory standards and that customers understand what they are purchasing from us. We also aim to make sure we price our policies prudently and we invest our assets appropriately to minimise any potential losses. We mitigate risks by adopting policies and minimum standards that are regularly reviewed and updated to ensure that we are in line with the risk appetite set by the Board. Regular reviews by external experts supplement this internal control framework.

We aim to make our products easy to access and to give our customers what they are looking for, to ensure they are appropriately covered when unexpected events happen.

We apply a multi-brand, multi-product and multi-distribution channel business model to sell to retail customers and businesses. Products can be purchased online, including via PCWs, by phone and indirectly through partners and in our Commercial business, via brokers. Each brand provides products targeted at one or more insurance segment: motor, home, rescue, pet, travel and commercial. By tailoring the mix of distribution channel for each product, we can offer our customers a combination of brands, products and services that best suits their needs.

The scale of our business, which has been operating for almost 30 years, gives us deep insight into the risks we underwrite, which enables us to improve pricing accuracy. It also allows us to invest more heavily in data and achieve efficiencies, which means we can more accurately set the appropriate price for the risks we underwrite.

If the time comes to make a claim, it is at that point that customers see the value of their policy. Through active engagement with our customers, we aim to settle their claim as quickly and as easily as possible. Doing this the right way helps us to demonstrate the value of the products and services we provide and manage our claims costs.

See how we deliver value through our business model:

New Offerings

Our new customer offerings, such as our telematics black box and smartphone apps, are helping us to improve our pricing models.

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Timely Updates

Our claims transformation programme is improving the way we deal with customers, making it smoother and faster.

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Weather response

Over the last year the UK experienced some of the worst wind and rain storms in a quarter of a century, leaving many homes damaged and without power.

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