Groupama-owned motorbike broker took profit hit to branch into cherished cars
Motorcycle specialist broker Carole Nash has posted a 4% increase in turnover, despite a fall in the number of bikers on UK roads.
Carole Nash’s turnover was £26.2m last year, up from £25m in 2011, while the number of bikers fell from 1.3m to 1.2m.
Pre-tax profits fell 13.6% to £5.1m after the broker invested nearly £1m in its cherished cars division, which sells policies for classic and performance vehicles. The division was launched 18 months ago, with a separate team of customer advisers, marketers and director.
“We’re really pleased to have increased market share. Our profit was 105% of the internal target we set with our shareholder [Groupama],” said chief executive David Newman (pictured).
On course to break even
Newman told Insurance Times he expected the cherished car division to break even by 2014 and he has his sights set on 100,000 customers after five years in the market, which would give the broker a 10% market share.
Newman said cherished car drivers, like motorcycle riders, are passionate about their vehicles and don’t just use them to get from A to B.
“We took our core competency or customer intimacy and wanted to find another area where customers are enthusiasts and want to have a conversation,” he said.
Lower rates than forecast
Carole Nash has seen motorcycle rates soften by single digits this year, while cherished car rates were lower than it had forecast when it entered the market.
This year, Carole Nash plans to grow its ‘no frills’ Just Motorcycle Insurance brand through the aggregators, and to continue investing in its cherished car division.
Carole Nash will take a hit from April’s ban on referral fees, but Newman vowed to continue to refer policyholders to injury and advice experts.
“A number of our customers are tragically killed or seriously injured, and in the vast majority of cases it’s not their fault,” he said.
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