DLG more than doubles motor GWP in space of quarter

Direct Line Group (DLG) has revealed that it saw “strong” growth in Q3 2023 as price rises led to its motor revenue more than doubling compared to the previous quarter.

In a trading update released today (7 November 2023), the insurer revealed that its motor business secured a gross written premium (GWP) £826.8m in the three months to September, up from £400m in Q2 2023.

DLG also revealed that it secured £1.59bn in the nine months to September, up 45.4% from the same period in 2022.

Jon Greenwood, acting chief executive of DLG, said that pricing actions the firm had taken “came through in strong premium growth”.

“We believe we are writing profitably, consistent with a 10% net insurance margin,” he added.

“At the same time, we have continued to progress our strategic agenda, launching Direct Line Essentials in motor, which improves our competitiveness in the direct market and we have welcomed around 725,000 motability customers.”

’Decisive actions’

DLG also revealed that its home GWP jumped from £139m to £144.4m year-on-year in Q3 2023, while its other personal lines businesses, such as rescue, secured £76.2m, up from £66.4m the previous quarter.

The increases came after the insurer sold its brokered commercial business to RSA earlier this year (7 September 2023), which DLG said had strengthened the business financially.

The purchase has been agreed for an initial fee of £520m, with potential for up to a further £30m contingent on earnout provisions related to financial performance of the acquired business lines.

As part of the deal, renewal rights, brands, employees and systems will all be transferred to RSA.

“The sale of our brokered commercial business to RSA strengthens our business strategically and financially,” Greenwood said.

“We are confident that the decisive actions we are taking sets the group up for improved performance going forward.”