Motor book grows by over a tenth to £335m
Halifax Bank of Scotland (HBOS) has reported a decrease in its insurance profits of 24% to £232m. In a statement the company said this reflected a hit of £135m of last year's floods, which eclipsed the positive impact from growing its household business.
The company's premiums fell slightly by 1% to £1.76bn. HBOS said that it had increased the number of policyholders by 900,000, or 26%, to 2.8m.
The company grew its motor and households accounts by 12% and 5% respectively, to £335m and £549m.
HBOS' combined operating ratio stood at 90%, up 8% on the previous year. The company said that if the impact of the floods were removed from the its results, the COR would have remained flat.
In a statement HBOS said: "Growing our share of the household insurance market is an important strategic priority allowing us to leverage our market leading mortgage position. We have therefore increased our investment in sales and marketing activity to raise product and brand awareness, supported by some highly successful promotions."
The company added the Sheila's Wheels had experienced premium growth of 70% and had reached 200,000 policies.
"Sales have risen across our motor brands, with the greater prominence of web-based business being an important factor."
HBOS added that the market was showing early signs of hardening which it could exploit. It said: "Strong price competition has continued, although we are starting to see some signs of price increases in the UK market. With the strength of our brands, we believe these price increases will provide an opportunity for significant growth in market share."
