Insurer gears up for expected upturn in rates next year
Chaucer is gearing up for a potential turnaround in the UK motor market by increasing the amount of business it will write in the sector for 2008.
The Lloyd’s insurer intends to increase capacity for its motor portfolio by around 10% next year in anticipation of improved market conditions.
Chris Dixon, divisional underwriting and development director at Chaucer, said: “It is our view that the market should start to see the benefits of an upturn in premium rates next year.
“[A 10% rise in capacity] is not a massive increase, but it is an increase. Hopefully the market will start coming back to us.”
Overall the Lloyd’s insurer will cut its capacity on Syndicate 1084 by 8.3% to £445m for 2008 with the proposed increase in UK motor business partly offsetting the targeted reduction across non-motor classes.
Chaucer’s planned increase in motor insurance comes amid contradictory reports on the status of the motor insurance market in the UK.
Insurancewide.com revealed a drop in average car insurance premiums in the second quarter of 2007 compared to figures released by the AA, one of the many brokers that appears in Insurancewide.com’s extensive panel of direct insurers and brokers, that showed a rise of 2.5% in the period.
The Insurancewide car insurance premium index revealed that the average UK premium was £738 in April 2007, falling to £703 in June – a drop of 4.6%.
However, car insurance premiums have reached their highest ever level, according to the AA’s benchmark British insurance premium index.
The index shows that over the past quarter, the average quoted premium index for an annual comprehensive car insurance policy rose to more than £822.