Ageas UK has announced that gross income dipped by 2% to £1.4bn in its latest full-year results, largely reflecting reduced volumes from the Tesco Underwriting divestment in the final quarter.
According to the insurer, the “small change” also reflects lower mobility on volumes, reduced motor pricing during lockdown, and motor pricing discipline, which was applied at the start of 2020 and linked to claims inflation.
Despite this, the group welcomed growth in its household and commercial lines, largely driven by new deals in the broker household market, and growth in non-motor commercial lines schemes.
The group also reported a full-year net result of £58m, down only 3% from £60m the year before, while a 95.2% COR reflected the lower frequency of motor claims as a result of less traffic on the roads, which offset the impact of multiple weather events during the year.
It added that the motor market continues to evolve with “underlying uncertainties”, reflecting claims inflation and expected future liabilities with a post-Brexit and post-pandemic impact on claims costs.
Meanwhile, claims volumes in its household line increased due to severe weather in February, August and December, with the insurer noting this was “particularly noticeable compared to the benign weather of 2019”.
In total, gross inflows in its motor division fell from £778.5m to £743.8m in FY20, while gross inflows in its household division rose from £275.2m to £302.6m in the same period.
Ant Middle, CEO of Ageas UK, said: “We have returned a resilient financial result in the context of the current climate, with reduced motor claims frequencies offsetting the major weather events experienced throughout the year.
“Reported income reflects the anticipated divestment of our share in Tesco Underwriting and the effects of the pandemic, alongside our disciplined and responsive underwriting throughout the year.”
He added: “We are also pleased to see the positive impact of our trading with a wide range of brokers throughout the year, which underlines the enduring strength of these relationships no matter what the challenges.
“As we face another year of uncertainty, we are confident that we have a solid foundation on which to build. We enjoy strong relationships with brokers, the commitment of our employees, and exciting plans for the future development of Ageas in the UK.”