Sabre profits drop in H1 2023 despite rise in GWP

Sabre Insurance has revealed that its profits dropped in the first half of 2023 despite a rise in gross written premium.

In a trading update, the insurer highlighted that it secured a profit after tax of £3.8m in the first six months of the year, down from £6.7m in the same period during 2022.

Its pre-tax profit also dropped from £8.6m to £4.8m year-on-year, while the combined operating ratio (COR) rose from 92.7% in H1 2022 to 93.8% in H1 2023.

Sabe said inflation continued to be a factor across the industry, while COR was “negatively impacted” by an increased expense ratio driven by lower earned premium.

While the firm secured a GWP of £99.5m in the first half of 2023, up from £91.8m in 2022, net earned premium dropped from £77.5m to £71.8m.

However, Sabre chief executive Geoff Carter said the results were “in line with our expectations and support our full year projections”.

“I am pleased with the position we find ourselves in at the half year point and believe our long-term strategy of disciplined pricing, early assertive corrective actions when required and a tight focus on emerging claims trends continues to prove its value,” he added.

Individual businesses

Meanwhile, Sabre highlighted that it grew its motor book year-on-year, with GWP rising from £69.7m in H1 2022 to £83m in H1 2023.

Its taxi business also saw revenue rise from £5.2m to £7.4m.

“In our established motor vehicle product account, we are having an excellent year,” Carter said.

“We took early pricing action in response to inflation and are now reaping the rewards as others in the market continue to catch up.”

He added that the taxi product was still in development phase and that underwriting action was required in the first half of the year to get performance to required levels.

“Premium volumes are still being restricted due to market dynamics, while the combination of low premium and immature claims means the taxi business is not likely to deliver a meaningful contribution to profit until 2024,” Carter said.

“We are, however, satisfied with the way this product is evolving.”

The firm also revealed that its motorcycle book saw GWP ffall rom £16.9m in H1 2022 to £9.1m in H1 2023.

However, Sabre said the product was “maturing well”.

“As expected, premium levels are slightly reduced as underwriting actions last year continue to take effect,” Carter added.

“We nonetheless anticipate a profitable contribution in 2023 and, having optimised our rates, we are now reviewing additional distribution opportunities.”