Increased car sales steer Direct Line to success

MORE car purchases and rising motor insurance premiums set the scene for a strong rise in sales by insurance giant Direct Line.

The FTSE 100 giant, best known for its distinctive red telephone mascot and Harvey Keitel ads, said premiums sold through its motor business rose 10.1% over the year to £1.1 billion.

That was thanks both to higher car sales during the period and rising premium rates, which have been depressed by comparison websites. Car insurance prices have been drifting up recently — they are 16% higher than last year — giving insurers better prospects.

Including its other main business — home insurance — total gross written premiums for the company rose 4.5% to £2.5 billion.

Direct Line said profitability from its underwriting will be at the upper end of expectations.

Costs on paper may also look higher next year because of IT upgrades. “Customers like the value, service and brand proposition we offer them,” chief executive Paul Geddes (pictured above middle) said.

Insurance broker JLT also delivered a “resilient” performance over the summer, despite ongoing pressures in the energy and marine insurance broking market.