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Direct Line Group have reported a 4.2% increase in gross written premiums for ongoing operations versus Q115, although total in-force policies fell 1.8% following a significant fall in the Rescue and Other Personal lines.
Operating expenses rose £5m, offset by lower claims handling expenses.
Flood Re (the industry levy which helps to provide affordable flood insurance to high risk areas) launched on 1 April 2016. The group's contribution, based on market share, is expected to be £25m in 2016.
Direct Line shares were flat in early trading.
Motor - 46% of gross written premiums:
In-force Motor policies rose almost 2% versus Q115 with gross written premiums for the quarter improving markedly to £360.7m (Q115: £326.4m). Growth was driven by improvements in both own brand and partnership with the division benefitting from a significant 9.4% increase in risk adjusted pricing.
Home - 26% of gross written premiums:
In-force Home policies were broadly flat, with a small decline in partnership policies offset by a small increase in own brand. Gross written premiums declined 3.5% in the quarter, driven largely by a 5% decline in partnership premiums. Risk adjusted prices declined 2.3%.
Rescue/Other - 12% of gross written premiums:
Rescue and Other Personal Lines saw in-force policies fall 3.7% as a result of lower partnership Rescue volumes. Gross premiums rose 1.9% with Rescue up 4% following a strong performance from the group's Green Flag own brand.
Commercial - 15% gross written premiums:
Commercial in-force policies rose 5.8% based on stronger Direct Line for Business sales. Gross written premiums rose 2.1%.
Paul Geddes, CEO, commented:
"For the rest of 2016, we will aim to build on these foundations, while keeping a firm control of our costs, and we reiterate our combined operating ratio target of 93% to 95% for ongoing operations."
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