Motor insurer disappoints investors following nine month results
Hastings’ share price fell 9% today, amid concerns on claims inflation forecast to be running at the ‘lower end of target range’.
The broking group said claims inflation was expected to continue to be higher than premium inflation and its loss ratio was forecast to the lower end of its 75 percent to 79 percent target range.
“The group expects to maintain its disciplined pricing strategy in the ongoing competitive market that is likely to continue for the rest of the year,” Hastings said in its nine-month results.
Tough year for market
It has been a tough year for insurers with the Beast from the East in winter causing claims and then the hot summer weather.
But prices remain soft with the expected changes in the Ogden rate and Civil Liability Bill both on the cards - despite uncertainty over exactly what shape they will finally end in.
Meanwhile, repair costs are ballooning as repairing modern cars with hi-tech gear is proving expensive, and even the fall in small collisions is not making up for it.
Hastings live customer policies rose 4% to 2.70m for the period, a 4% year on year increase.
Gross written premiums rose to £738.5m for the first nine months of this year, compared to £714.3m reported a year earlier
‘We have 2.7 million customers, an increase of 4% from last year, which we achieved whilst remaining true to our pricing discipline and increasing premiums in a competitive market,’ said Toby van der Meer, chief executive.
‘We remain well positioned in a very large market with 31 million cars on the road, growing consumer adoption of digital channels and continued media and regulatory focus on consumer switching.’