Highway’s broker arm, Hero, is set to launch its own aggregator early next year in an attempt to drive the group’s digital distribution strategy.
The news came as Andrew Gibson, chief executive of Highway, laid out plans to grow the group’s GWP by 20% to £300m over the next two years.
Gibson said the company was already re-gearing software to transact more business with aggregators, and would be looking to widen its footprint in the private car sector.
He also said the company was looking to grow its specialist lines business, relaunch its motorcycle and household products and “leverage the value of claims operation” by offering outsourcing services to other businesses.
He said: “We’re not trying to shoot out lights. We are delivering a 25% return on equity. Our target is to improve this figure to 30%.”
Last month, Fortis said it would be launching its own aggregator service.
Meanwhile, former Zenith executives are on the verge of rolling out their own price comparison website, First Central.
Hero, the eleventh largest personal lines broker in the UK, already runs aggregators for Thomson Directories.
Gibson said it was “on target” to achieve a quarter of a million policyholders, up from its current mark of 230,000. At present, a sixth of Hero’s business is placed with Highway.
Analysts said the group was on target to deliver pre-tax profits of around £20m, despite claims inflation of 2.2%, including a £1m hit from the summer floods.
Gibson predicted Highway’s combined operating ratio in 2007 would be “around 100%” – a deterioration from 98.9% last year, but still substantially better than the market average.
Highway has increased its commercial and personal lines rates by over 6% so far this year, including sizeable hikes in recent months. Gibson reiterated that the company was prepared to lose volume in order to maintain price.
Over the first six months of 2007, the group controlled GWP of £131.2m and posted pre-tax profits of £11.8m.