Executive Summary

Continued growth in inflows

  • Total income up 11.1% to GBP 513.3 million compared to Q1 2011
  • Non-Life Gross Written Premiums up 10.8% to GBP 445.5 million
  • Total inflows from Retail businesses up 3.1% to GBP 52.8 million  
  • Protection GWP up 71.2% to GBP 15.0 million and New Annual Premiums up 34.3% to GBP 9 million

Significant improvements in performance 

  • Profit Before Tax has risen to GBP 22.0 million  (Q1 2011: 3.8 million)
  • Overall combined ratio at 102.3% reflecting usual seasonal patterns in Household claims (Q1 2011: 106.0%)
  • Non-Life Motor combined ratio shows continued improvement to 98.0% (Q1 2011: 100.3%)

Well capitalised business

  • Strong capital positions in Ageas Insurance Limited, Ageas Protect and Tesco Underwriting
  • Continued progress in development of multi-distribution and product strategy  
  • Strong organic growth within Ageas Insurance Limited and Tesco Underwriting
  • Ageas Retail remains UK’s  9th largest broker and 4th largest Personal lines broker
  • Protection distribution expanded; 56% growth in customer numbers

Announcing the 2012 Q1 results, Barry Smith, Chief Executive of Ageas UK commented:

 “I’m really pleased with progress in the first few months of 2012 in what is typically a tough quarter.  We continue to build on our transformational growth of 2011 with strong increases in income and profit.  Our strategy of working very closely with our brokers, affinity partners and Independent Financial Advisers to offer quality products and service to customers continues to pay off.  The market is not without its challenges given the current economic and regulatory environment but our balance of underwriting and distribution across Ageas UK means that, overall, we are in good shape to continue to deliver profitable growth.” 

Business Results

Ageas UK

Ageas UK continues to deliver a strong performance, reflecting a clear and consistent multi-distribution strategy and partnership approach with brokers, affinities, IFAs, intermediaries and our own Retail businesses.  The combination of high quality service and low cost delivery remains a key area of focus for all the Ageas UK businesses.

Income and profit for the first quarter of 2012 has increased. There has been strong organic growth in Ageas Insurance Limited, Tesco Underwriting and Ageas Protect through increased business with brokers, IFAs and new partnerships. Ageas Retail has also experienced slight growth due to the inclusion of Castle Cover and despite the difficult economic climate.   

Total income reached GBP 513.3 million, a rise of 11.1% compared to the same period last year and overall pre-tax profit across Ageas UK increased to GBP 22.0 million (GBP 3.8 million Q1 2011).


Ageas Insurance Limited

Total Gross Written Premiums (GWP) during the first quarter of 2012 increased by 11.5% over the same period in 2011 to GBP 300.0 million (Q1 2011 GBP 269.0 million), driven by the continued development of Ageas’s Personal and Commercial lines portfolios.

Growth in the Personal lines business reflected an increase primarily across Private car where income was up 30.3% to GBP 153.0 million. Household income decreased (Q1 2012 GBP 74.4 million, Q1 2011 GBP 82.2 million) due to pricing action taken which has improved profit performance.  The Travel account is broadly in line with last year (Q1 2012 GBP 12.2 million, Q1 2011 GBP 13.3 million). Ageas Insurance Limited also saw a 4.6% growth in Commercial lines GWP to GBP 50.4 million (Q1 2011: GBP 48.2 million). 

In terms of Private car, Ageas has continued its consistent approach of pricing to reflect the underlying risk. These actions have led to positive results on Ageas Insurance’s Motor combined ratio which is now 95.5% (Q1 2011 97.3%).

Profit before tax for Ageas Insurance Limited reached GBP 11.8 million (Q1 2011: GBP 3.9 million).

Recognition for Ageas Insurance Limited’s service quality continued during the period being voted by brokers as Best Insurer for Personal Lines Claims Service and Best Insurer for Personal Lines Underwriting Service in Insurance Age’s Sentiment Survey.   Ageas Insurance was also awarded Claims Management Team of the Year at the Barker Brook Media Claims Innovation Awards for the way it manages motor claims through its in-house solution, The Ageas Way. 

Tesco Underwriting: 

Tesco Underwriting, the Motor and Household insurance partnership with Tesco Bank, of which 50.1 per cent is owned by Ageas, now insures 1.5 million customers.  It generated GWP of GBP 145.5 million during Q1 2012 (GBP 133.2 million Q1 2011) and a profit before tax of GBP 7.0 million (Q1 2011 a loss of GBP 4.0).

Life Protection:

Ageas Protect continued to make good progress, with total GWP inflow increasing by 71.2% to GBP 15.0 million (Q1 2011: GBP 8.8 million) and New Annual Premiums increasing by 34.3% to GBP 9.0 million (Q1 2011 GBP 6.7 million). 
This continued growth reflects the successful roll out of the company’s Protection proposition to an increasing number of IFAs and new affinity partnerships.  The business now has 211,000 customers, an increase of 56% over the same period last year. Growth in the Protection business has been heavily driven by its award-winning approach to underwriting, market-leading technology, high levels of service and product innovation.  In the recent Life Search Awards, Ageas was voted Best Provider for Existing Customers and Best E-commerce Provider. 

In line with its continued development since its launch in July 2008, the business delivered a near break even result, halving its pre-tax loss to GBP 0.4 million compared to the same period last year(Q1 2011: pre-tax loss GBP 0.8 million).

Other Insurance Activities:

Ageas UK’s Other Insurance activities, which principally comprise the Retail companies, increased income in a tough and competitive environment.  Ageas Retail consists of RIAS, Kwik Fit Financial Services (KFFS), Ageas Insurance Solutions (UKAIS) and Castle Cover strengthening Ageas’s overall distribution and manufacturing mix. Total inflows increased by 3.1% to GBP 52.8 million (Q1 2011: GBP 51.2 million).  Profit Before Tax for the Other Insurance activities including the Retail businesses was GBP 3.6 million (Q1 2011: GBP 4.7 million) a decrease reflecting the current tough and competitive economic climate.