The LV= and L&G deals have doubled the size of the insurer

The acquisition of both LV= General Insurance and the general insurance business acquired from Legal & General have helped Allianz double the size of its book of business, which now stands at more than £1bn of gross written premium (GWP).

In the first quarterly update since the acquisitions, Allianz Holdings chief executive Jon Dye said the business had experienced good underlying growth over the quarter, but that the coronavirus pandemic was leading to a slowdown of new business.

“The company has doubled in size to become the second largest general insurer in the UK and achieved substantial underlying growth in both commercial and personal lines,” he said. “However, the quarter also saw significant claims for storms and floods amounting to £68m, and the slowdown in new business due to Covid-19 was already being felt at the end of Q1.”

This underlying growth has seen the insurer grow its commercial lines business by 7% over the first three months of 2020 to £514m, although flood related claims on the motor trade, property and packages accounts amounted to £43m, which was significantly above the insurer’s provision for natural catastrophes.

The insurer also confirmed that it had already made more than 200 interim and final settlement payments for business interruption claims stemming from Covid-19, and has created a coronavirus resource hub with FAQs and useful information to support customers in managing their businesses through the crisis.

And Allianz has also taken steps to support its commercial lines customers, including automatic extension of cover for working from home, a temporary extension of full cover where premises become unoccupied and flexibility in its change of business underwriting appetite when this is humanitarian in nature or to protect employment.

Dye said that the coronavirus outbreak represents an “unprecedented period” for insurers, but said he was “proud” of the way Allianz Holdings was handling the challenges of the pandemic.

“We opened a new chapter for our business and it would be no exaggeration to say that this coincided with the start of an unprecedented period for the market and the country, as we live through the largest insured event in history,” he said. “I am tremendously proud of the way in which our colleagues across the business have performed against this backdrop. We mobilised quickly and effectively to achieve a remote working model, which has maintained service levels to our customers and brokers, and we continue to adapt to meet the demands of this evolving situation.”

“As part of our commitment to our people, we announced that no one would be furloughed,” he added.

In personal lines, LV= General Insurance reported GWP growth of 37% to £512m, which included £102m from L&G General Insurance. The insurer was, however, impacted by Storm Ciara, Dennis and Jorge, resulting in 12,000 claims at a cost of £26m.

In response to the coronavirus pandemic, the insurer recently announced that it is making £30m available to its direct car and motorbike insurance customers through its Green Heart Support to help those who are experiencing financial difficulties as a result of the outbreak.

The money is being made available due to the savings that the insurer expects to make as a result of reduced claims during the lockdown.

The insurer is also not charging administration or cancellation fees and is waiving excesses on claims for the hardest hit financially, as well as offering free enhancements to cover for customers who are NHS and key workers.

It has also been supporting its partner supplier network through increased payments to some suppliers, including bodyshops, breakdown drivers and home contractors.

LV= General Insurance chief executive Steve Treloar said: “At LV=, we pride ourselves on always trying to do the right thing for our people, customers, suppliers and the communities we operate in. Our people work tirelessly every day to ensure our customers are put at the heart of everything they do and never has that been more true than it has been in these last few weeks, as we’ve all faced the challenges presented to us by Covid-19.

“From a performance perspective, the strength of our brand and the strong foundations we have as a business have resulted in us being able to deliver a good result, achieving solid growth in what continues to be an extremely competitive market.”