Norwich Union Direct and the AA pump more cash into advertising campaigns to counter soft market

Insurers increased their advertising spend by millions of pounds in the first eight months of 2004 as they battled against the soft market.

Norwich Union Direct and the AA increased their spending with respective increases of 59% and 31% in total advertising spend compared to the same period in 2003, according to figures from media consultancy Universal McCann.

The only major insurer to buck the upward trend was Direct Line, which dropped its spend by 18%. Churchill increased its total spend by 10% to over £30m.

Universal McCann strategy director Andrew Raad said: "In terms of individual media spend, money has been shifted into radio (up 20%), direct mail (up 18%) and TV (up 15%). This has been at the expense of outdoor (down 30%) and press (down 12%)."

For the 15 months from January 2003 to March 2004 insurers spent a total of nearly £320m, according to Universal McCann.

An insurance analyst said: "You have to look at the initiatives of individual insurers. Norwich Union's Quote Me Happy campaign is new. Consequently, it will put a big push behind it and this will result in a big spend.

Direct Line on the other hand has scant few strong executions this year. Charlie's Angels has not been successful, according to many commentators and it doesn't have any other major ads to air. This is likely to be one of the reasons its spend has dropped."