Insurer forecasts increase in motor rates by nearly 14% in 2010
Lloyd’s insurer Chaucer is “on track” to hit its sub-100% combined ratio target for new UK motor business, according to the firm’s chief executive Bob Stuchbery.
Chaucer increased motor rates by 11% in Q1 of 2010, according to its interim management statement, and forecasts an annual rate increase of 13.9%. Stuchbery said the company was unsatisfied with the 110% combined ratio it posted for 2009 in its UK motor book and has vowed that all the business written and earned in 2010 would have a combined ratio below 100%.
“On an annual accounting basis, we will still be earning some of the 2009 business in 2010, so the headline combined ratio for 2010 will probably still be above 100%, but I wanted to see definitive evidence that those rate increases are flowing through and improving the combined ratio for business written and earned in 2010,” he said.
Overall, Chaucer pushed through rate increases of 3% in Q1 2010, against its annual target of 2%.
Chaucer expects a significant rise in offshore energy rates after the Deepwater Horizon oil rig disaster, and said it would be selectively writing more aviation business thanks to rising rates in response to heavy 2009 airline losses.