Direct Line today said industry losses from St Jude’s storm were likely to be significantly lower than the £500 million some experts have already predicted.
Chief executive Paul Geddes said his company’s claims were set to fall within the £25 million it expected to incur from bad weather during the fourth quarter of 2013. On that basis, he reckons the industry loss will be no more than £125 million, less than the £300 million to £500 million insurance broker Willis predicted earlier this week.
The estimate came as Direct Line increased its operating profits by 20.1% to £417.8 million during the first nine months of the year despite underwriting 4.3% less business. The company said motor insurance prices were 5% lower in the third quarter compared with 2012. “Although these results demonstrate our continuing choice to focus on value of business over volume, in motor we were able to reduce average prices for our customers helped by our own claims efficiencies and the benefits of the recent legal reforms,” Geddes added.
