Ageas premiums shrink but profits up 208%

Ageas has reported profitability of £77m for 2018, although premium income across all lines are down.

The profit figure compares favourably against the 2017 figure of £25m, and boss Andy Watson explained to Insurance Times that this had been generated through its strategy to simplify the business.

The result was largely due to a significantly stronger performance on motor. The combined operating ratio for motor was at 93.4%, when it it was 102.6% for 2017.

But this profitability in motor was earned at the expense of gross premiums. GWP was down 8.2% in motor from £859.4m to £788.4m. 

The lower volumes overall were put down to a “continued focus on pricing and underwriting discipline ub a soft personal lines motor market”.

Watson attributed the losses made in home and other lines (including commercial) down to the Beast from the East in March and floods to hit the UK in May. He said underlying performace of home was good, following the exit from underperforming schemes.

And looking ahead, Watson was optimistic. He said: “Our performance in 2018 has put us in a strong position for 2019, but we are not complacent and hence have been taking further action to simplify our business and respond to changing consumer trends to ensure we remain fit for the future.”

Overall GWP for all non-life Ageas UK entities, including Tesco Underwriting, were at £1.57bn for 2018 - a 10% drop from 2017 (£1.74bn).

Excluding Tesco Underwriting premium inflows were £1.23bn, down 9% on £1.36bn in 2017. 

The results indicate Tesco Underwriting wrote £341.6m for 2018, down 12% on 2017, when it wrote £387.5m.