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10 Nov 2020 | 08:39

Direct Line reports broadly flat Q3 trading

(Sharecast News) - Insurance group Direct Line reported a broadly flat third-quarter trading performance on Tuesday as its Green Flag and commercial units offset lower average premiums. Direct Line saw total written premiums slip 0.8% to £851.5m in the three months ended 30 September as Green Flag and commercial revenues grew 9.6% and 12.4%, respectively.

Average premiums were lower down as a result of a lower level of new car sales throughout the period and a decreased number of young drivers entering the market and flat own-brand motor policies.

Direct Line, which stated own-brand gross written premiums slipped 1.4% year-on-year, also reiterated its previous estimates for Covid-19 impact, with a £10.0m hit stemming from business interruptions and £25.0m from travel claims.

However, Direct Line did warn of uncertainty surrounding a Financial Conduct Authority report that outlined major changes to pricing practices in the insurance market.

Chief executive Penny James said: "We are encouraged by our trading performance in the third quarter where we saw a return to strong growth in Green Flag and commercial and some improvement in motor and home own brands, particularly in the price comparison website channel as customer shopping activity started to recover.

"This progress is testament to the flexibility and commitment of our people who have been successfully navigating through the Covid-19 pandemic, delivering good operational progress, providing extra support for our customers and helping local communities."

As of 0835 GMT, Direct Line shares were down 0.93% at 288.70p.
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