Direct Line Insurance Group PLC Trading Update for Q1 2024 (1)

Adam Winslow, CEO of Direct Line Group, commented

"We have seen a positive start to 2024 trading, with double digit gross written premium growth in our Motor, Home and Commercial businesses and overall growth for ongoing operations of 15.0%. Claims trends and Motor margins continue to develop in line with our expectations.

"We have announced a number of significant hires over the last few weeks. I am confident that with the new leadership team in place, we can deliver run-rate annualised cost savings of at least £100 million by the end of 2025 and a net insurance margin, normalised for weather, of 13% in 2026.

"I look forward to sharing our refreshed strategy to deliver higher returns and the progress we have made against the immediate priorities to improve performance at our Capital Markets Day on 10th July 2024."

Trading summary

3 months

3 months

Change to 3 months 2023

 

2024

2023

 

£m

£m

Gross written premium and associated fees

 

 

 

Motor direct own brands2

 400.1 

 352.9 

 13.4% 

Motor partnerships3

 24.2 

 5.8 

N/A3

Motor

 424.3 

 358.7 

 18.3% 

Home direct own brands2

 110.5 

 94.4 

 17.1% 

Home partnerships

 36.8 

 34.6 

 6.4% 

Home

 147.3 

 129.0 

 14.2% 

Green Flag Rescue

 20.3 

 19.4 

 4.6% 

Other Rescue and other personal lines

 43.2 

 45.3 

 (4.6%)

Rescue and other personal lines

 63.5 

 64.7 

 (1.9%)

Commercial direct own brands2

 71.7 

 62.4 

 14.9% 

Ongoing operations4

 706.8 

 614.8 

 15.0% 

Brokered commercial insurance4

 155.1 

 156.9 

 (1.1%)

Run-off partnerships4

 30.3 

 34.0 

 (10.9%)

Total Group

 892.2 

 805.7 

 10.7% 

 

31 Mar 2024

31 Dec 2023

Change to 31 Dec 2023

In-force policies - ongoing operations4 (thousands)

 9,268 

 9,442 

 (1.8%)

Trading update

  • Gross written premium and associated fees for ongoing operations up 15.0% on Q1 2023 with strong growth in Motor, Home and Commercial direct.
  • In-force policies were 1.8% lower. As expected, Motor volumes were lower due to the continued repricing of the Motor book, whilst Home own brands in-force policies saw modest growth.
  • Motor claims trends in line with expectations, with estimated written margins maintained above 10%.
  • Q1 saw several periods of adverse weather which led to around £33 million of weather claims in Home, of which £24 million was event related, compared with our annual event assumption in Home of £54 million. 

For further information, please contact

 

 

PAUL SMITH

DIRECTOR OF BUSINESS PERFORMANCE AND INVESTOR RELATIONS

 

ALAN OLIVER

GROUP COMMUNICATIONS

Email: [email protected]

 

Email: [email protected]

Mobile: +44 (0)7795 811263

 

Mobile: +44 (0)7385 481295

APPENDIX 1: Gross written premium and associated fees

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

 

£m

£m

£m

£m

£m

Gross written premium and associated fees

 

 

 

 

 

Motor direct own brands2,5

 400.1 

 422.0 

 435.1 

 391.3 

 352.9 

Motor partnerships3,5

 24.2 

 40.3 

 391.7 

 8.7 

 5.8 

Motor

 424.3 

 462.3 

 826.8 

 400.0 

 358.7 

Home direct own brands2

 110.5 

 118.1 

 107.2 

 89.1 

 94.4 

Home partnerships

 36.8 

 36.3 

 37.2 

 34.6 

 34.6 

Home

 147.3 

 154.4 

 144.4 

 123.7 

 129.0 

Green Flag Rescue

 20.3 

 16.5 

 27.7 

 21.5 

 19.4 

Other Rescue and other personal lines

 43.2 

 42.0 

 48.5 

 44.9 

 45.3 

Rescue and other personal lines

 63.5 

 58.5 

 76.2 

 66.4 

 64.7 

Commercial direct own brands2

 71.7 

 58.8 

 63.0 

 56.8 

 62.4 

Ongoing operations4

 706.8 

 734.0 

 1,110.4 

 646.9 

 614.8 

Brokered commercial insurance4

 155.1 

 174.7 

 137.5 

 196.7 

 156.9 

Run-off partnerships4

 30.3 

 43.3 

 34.5 

 38.3 

 34.0 

Total Group

 892.2 

 952.0 

 1,282.4 

 881.9 

 805.7 

APPENDIX 2: In-force policies by segment4 (thousands)

31 Mar
2024

31 Dec
2023

30 Sep
2023

30 Jun
2023

31 Mar
2023

Motor direct own brands2

 3,235 

 3,373 

 3,441 

 3,607 

 3,669 

Motor partnerships3

 837 

 808 

 795 

 66 

 72 

Motor

 4,072 

 4,181 

 4,236 

 3,673 

 3,741 

Home direct own brands2

 1,721 

 1,706 

 1,686 

 1,705 

 1,731 

Home partnerships

 729 

 738 

 748 

 759 

 765 

Home

 2,450 

 2,444 

 2,434 

 2,464 

 2,496 

Green Flag Rescue

 1,036 

 1,048 

 1,062 

 1,093 

 1,073 

Other Rescue and other personal lines

 1,069 

 1,124 

 1,134 

 1,196 

 1,275 

Rescue and other personal lines

 2,105 

 2,172 

 2,196 

 2,289 

 2,348 

Commercial direct own brands2

 641 

 645 

 652 

 645 

 643 

Ongoing operations4

 9,268 

 9,442 

 9,518 

 9,071 

 9,228 

Brokered commercial insurance4

 281 

 286 

 291 

 293 

 287 

Run-off partnerships4

 2,543 

 2,224 

 2,221 

 2,199 

 2,187 

Total Group

 12,092 

 11,952 

 12,030 

 11,563 

 11,702 

 

APPENDIX 3: Motor and Home average premium (£)

​£

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

New business

 599 

 594 

 588 

 532 

 478 

Renewal

 515 

 513 

 480 

 412 

 373 

Motor direct own brands6

 541 

 537 

 507 

 445 

 401 

New business

 238 

 212 

 214 

 204 

 188 

Renewal

 261 

 259 

 257 

 249 

 230 

Home direct own brands

 257 

 249 

 250 

 243 

 224 

Notes:

(1).    The Trading Update relates to the three months ended 31 March 2024 and contains information to the date of publication.

2.   Direct own brands include in-force policies for Motor under the Direct Line, Churchill, Darwin, Privilege and By Miles brands, Home under the Direct Line, Churchill and Privilege brands and Commercial direct policies under the Direct Line and Churchill brands.

3.   Motor partnerships includes the Motability partnership, which started on 1 September 2023, and resulted in significant growth in the third quarter of 2023. From 2024, the majority of Motability gross written premium is recognised twice a year on 1 April and 1 October. As the Motability contract is a fleet contract, customer numbers are used to allow a more representative presentation of the Group's in-force policies.

4.   Ongoing operations – the Group's ongoing operations result excludes the results of the brokered commercial business, that it sold to RSA Insurance Limited in 2023, and the Rescue and other personal lines partnerships that the Group first excluded from its 2022 results. Relevant prior-year data has been restated accordingly.

5.   Gross written premiums for the By Miles brand which were previously reported within Motor partnerships have been reallocated to Direct Own Brands. There is no impact on in-force policies.

6.   Excluding the By Miles brand.