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Direct Line Insurance Group PLC on Wednesday will launch products on price comparison websites for the first time, as part of a ‘refreshed’ strategy aimed at making the firm the ‘customers’ insurer of choice.’ The Bromley-based insurance company announced the plan, and a revised capital allocation framework, ahead of a Capital Markets Day on Wednesday. Direct Line said it intends to pay around 60% of operating earnings as a regular dividend. ‘We expect the delivery of our financial targets to underpin attractive future returns for our shareholders’, the company said in a statement. This includes a ‘plan to restart regular dividends’. ‘The board will review the conditions it previously set to consider a restart of the regular dividend on an ongoing basis,’ Direct Line added. Direct Line expects its solvency capital ratio to build over time to support additional shareholder returns. In the medium term, Direct Line is targeting a solvency ratio of around 180%; however, in the short-term, it expects to maintain a solvency ratio above this level. In 2023, the solvency ratio was 197%. The company reiterated its target of at least £100 million of gross run-rate cost savings by the end of 2025 and reiterated its target of a 13% net insurance margin in 2026. In its Motor business, Direct Line pledged to deliver sustained, profitable growth and said it would launch products on price comparison websites. It has previously refrained from such a move. ‘Putting our strongest brand, Direct Line, on price comparison websites, where 90% of consumers shop, means we will be shaking up the motor insurance market once again,’ said Chief Executive Adam Winslow, who joined the business earlier this year. Outside of Motor, Direct Line said Commercial Direct would expand into ‘underserved’ segments. In Rescue, the company plans to launch its own fleet of patrol vehicles. Direct Line said it has decided to exit or stop investing in original equipment manufacturer Motor partnerships and Pet, Travel and other personal lines businesses. Winslow said: ‘Today, we have set out our strategy and clear targets designed to position [Direct Line] as the customers’ insurer of choice.’ Shares in Direct Line fell 0.4% to 192.20 pence in London on Wednesday. Copyright 2024 Alliance News Ltd. All Rights reserved.
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