Covéa Insurance announces 2016 results

19th May

Covea Insurance plc has today announced its financial results for 2016.  The company is pleased to report an £193.6m increase in gross written premium, an increase in profit before tax and a stable combined operating ratio.

 

 

 

2016
£m

2015
£m

Gross written premium

 

666.3

473.0

Profit before tax

 

38.4

12.9

Combined operating ratio

 

96.2%

96.9%

 

In its first full year of trading following the integration of Sterling Insurance Company Limited (SICL), the significant increase in gross written premium reflects the inclusion of the SICL business and the development of the Provident Insurance direct motor insurance operation, along with underlying growth across the majority of the company’s personal and commercial lines activities.

The significantly improved level of profit before tax reflects the release of the claims equalisation provision on the implementation of Solvency II (£29.8m) and increases in the market value of the company’s investment portfolio, offset by an increase in claims reserves to reflect the impact of the reduction in the Ogden discount rate (£6.2m) and a higher than expected level of claims inflation in the personal lines business, notably in respect of vehicle repair and escape of water claims.

Announcing the results, James Reader, Chief Executive, commented:

“It’s pleasing to be able to announce that we delivered an increase in both written premium and profit in 2016.  We’ve faced a number of headwinds, particularly in respect of the Ogden rate change and higher than expected levels of inflation on certain types of claim, but we continue to respond positively and maintain our focus on delivering a great service for our customers and broker partners and sustainable profitable growth for our business.

The successful integration of the former Sterling Insurance business has been a particular highlight of the last year, giving us the benefits of a broader, stronger business and the ability to offer our partners a more diverse product range.   

We’ve also delivered a number of other important initiatives, such as the launch of Provident Insurance, and have continued with the excellent progress we’ve been making to enhance the quality of the products and services that we provide to our customers and business partners.  Overall, the fantastic progress we’re continuing to make reflects the skills, effort and enthusiasm of the great team of people we have at Covéa Insurance.

I’m very confident that we are well placed to keep delivering profitable growth across all our lines of business over the coming years.”

 

-Ends-

 

About Covéa Insurance

Covea Insurance plc is the UK underwriting business of leading French mutual insurance group Covéa, who are number 1 for property and liability insurance in France and served 11.5 million policyholders, generating over 16.4 billion Euros in premiums in 2016.  

Covéa Insurance handles the insurance needs of 1.5 million policyholders; delivering financial reassurance through its Standard & Poor’s A+ stable rating, as a guaranteed subsidiary of Covéa. 

The company offers motor, household, protection, mid and high net worth insurance and a range of commercial insurance products, designed to meet the needs of most individuals and businesses. Employing over 1500 people, Covéa Insurance has a strong people and service ethos, having Investors In People Gold accreditation and featuring in the 2015 and 2016 Sunday Times Top 100 Mid-sized Best Companies to Work For. It also has World Class service accreditation from the Institute of Customer Service for its Motor Claims, Home Claims and Underwriting Services teams as well as Chartered Insurer status for its Commercial and Mid/High Net Worth business.

In January 2016, Sterling Insurance Company Limited became a fully integrated part of Covea Insurance Plc, following a Part VII transfer under the Financial Services and Markets Act. 

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