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Wednesday 22 November 2017

Esure shifts up a gear with record third-quarter premiums

The FTSE 250 group said gross written premiums had climbed 25% to £625.8 million for the nine months ending September.

Esure announces record third-quarter premiums, boosted by growth in the firm's motor insurance arm (PA)
Esure announces record third-quarter premiums, boosted by growth in the firm's motor insurance arm (PA)

By Ben Woods, Press Association Chief City Correspondent

Insurer esure has secured record third-quarter premiums and hiked its outlook after a growth acceleration from its motor insurance arm countered a fall in the home unit.

The FTSE 250 group said gross written premiums had climbed 25% to £625.8 million for the nine months ending in September, with third-quarter premiums clocking an all-time high of £233 million.

Motor insurance proved a key driver, shifting up 30% to £561.5 million over the nine-month period, while the home unit fell 6% to £64.3 million.

Shares climbed more than 3% during morning trading on the London Stock Exchange, as the firm said premiums were likely to grow between 20% and 25% for the full year, an upgrade on the 15% to 20% previously pencilled in by the firm.

Chief executive Stuart Vann said the motoring arm had been boosted by the company’s “proven underwriting expertise and footprint expansion programme”.

He added: “We remain disciplined in home, as current market conditions do not provide opportunities for profitable growth.

“Our strong performance to date gives us confidence that we will exceed previous guidance.”

Esure, which employs around 1,500 people and owns the Sheilas’ Wheels insurance brand, saw policies rise 10% to 2.3 million for the nine months, with motor insurance policies up 19% to 1.8 million.

The firm said it would move into next year “with confidence” and was on track to hit its target of three million policies by 2020.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: “Growth in motor gross written premiums is no great surprise, since prices are rising across the industry.

“However, rapidly increasing in-force policies is more unexpected, and very welcome.

“The struggling home division may take some of the shine off results, but there are industry-wide headwinds in that sector, and these remain undeniably good results.

“With policy numbers and combined operating ratios heading in the right direction, esure looks like its revving up the engine for a strong end to the year.”

Press Association

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