First evidence motor insurer’s turnaround is working
Motor insurer ERS has hailed the first tangible evidence of its turnaround after it turned a profit for the first time in five years.
The Lloyd’s managing agent, which runs Lloyd’s syndicate 218, has reported a half year profit of £1.2m, a £25m improvement on the same period last year.
Its combined operating ratio improved to 101.5% (HY 2013: 112.1%) while a £4m investment return pushed the insurer into the black.
ERS was bought by Aquiline from IAG in April 2013 and is led by chief executive Ian Parker.
Parker announced the closure of six branches, its exit from home and personal accident lines, and a broker only strategy last May.
ERS shrunk its book with gross written premiums down 5.7% to £194.9m.
Parker said today: “This profit has been hard fought and is a result of continuing to price and select risks carefully. This discipline has seen us reduce premium in some classes and we are prepared to do that if it means protecting our bottom line. However at a total portfolio level we expect our motor portfolio to grow this year.”
“There is no doubt that the operational turnaround is starting to deliver and the Q2 [half year] profit is the first tangible evidence the wider market has seen to prove this.
Parker said ERS’ new “motor only, broker only” strategy had been well received by brokers.