Direct Line Insurance Share Discussion Threads

[fenners66] 19/3/2024 20:13

adejuk

Whilst I concur that if you cannot see yourself as a customer there is every reason not to be a shareholder,
I would also say that the car insurance market has learned to operate as a cartel in the last year and they all
now realise that not competing is the best way for them all to make serious money.

I expect that as inflation settles down then some are going to break ranks again and go for growth but given price rises across the board I believe they all currently are making more money and will stick with the status quo for now.

So in essense you may have got a bad renewal - but there are a lot of them about.

[wba1] 19/3/2024 19:36

pete160;
the SBRE results were decent but, looking at the read across, 6.6 points of the COR improvement came from turn around in prior year contribution. Of the near 10 point improvement in COR only 3 points came from accident year improvement. It seems clear that Sabre acted early and fully to fill their reserving hole and the question is whether DLG did likewise. If they have things look positive since, as Sabre note, the 2024 accident year loss ratio will improve (and substantially) off the earned premiums written at much stronger rates in 2023. Obviously the 2023 DLG results will look inferior to Sabre as they took the hit to prior year in their 2022 results whilst DLG took a hit in H1 2023 but as long as prior year effects appear to have returned to normal patterns in H2 I will be ok.
Given the early action on both reserving and pricing by Sabre I will be very surprised if DLG results look similar (not at absolute level but in terms of trend). It would require a miracle to offset the later pricing and reserving action. The real question will be the absence of any new nasties or strengthening, the outlook and where they intend to go to restart growth ex-rating and diversify risk.

[adejuk] 19/3/2024 15:09

i held for a long time and sold when they raised my car ins by 80% last summer
it was about 185 then
obviously i'm sad i missed on this but if i were still a holder i would now sell
i have no intention of buying bsck at any price
i have no faith in their business model after what they did to my car premium.
btw, well done to all those who held on
rule 1 - sell the spike

[tuftymatt] 19/3/2024 12:42

Yeah the issues of last winter, pipe bursts etc etc, should be much lower this year and with the increase in premiums we have all seen, whoever we get our cover from, has to help paint a healthier picture right???

Good luck all 👍🏻

[pete160] 19/3/2024 12:38

as posted elsewhere...

Maybe not directly comparable to DLG, but seemingly very good results from Sabre this morning including a special dividend on the back of 'very strong market-wide price correction' and driven mainly by 47.5 per cent premium growth in its motor vehicle product.

I wonder if DLG will be similar or if they still have their foot in their mouth ?

[pander45] 19/3/2024 12:32

If he doesnt pull it out of the bag there will be big trouble bid wise. If the share price regresses expect increased interest. It would make the company very vulnerable indeed.

[jrphoenixw2] 18/3/2024 16:16

I've a hunch Thursdays prelims are going to make The Resurrection of JC dull in comparison. Man they have to to polishing those numbers!

[nellynell] 18/3/2024 15:45

Yep thats right Skinny Dividends. They are coming :-)

[nellynell] 18/3/2024 13:54

While Direct Line Group (DLG) is busy turning down takeover proposals, it’s business as usual for the insurer – recently extending its partnership with connected car data and devices provider Trakm8.

The tie-up, which began in 2014, has been extended for a further two years.

In an emailed announcement, the telematics supplier noted: “Trakm8 will continue to provide insurance data services and devices to Direct Line Group, including Trakm8’s advanced connectedcare data sets and AI-driven (artificial intelligence) FNOL (first notification of loss) crash algorithm.”

When the partnership came to life a decade ago, Trakm8 initially supplied hardware for DLG’s then newly introduced DrivePlus Plug-in offering.

At the time, Trakm8 executive chairman John Watkins said: “This is a key milestone for Trakm8, as Direct Line Group launches a step-change in telematics for UK consumers. This proposition accelerates the awareness of telematics as an effective tool to improve driving skills and reduce fuel costs.

“We look forward to building on this relationship further as consumers adopt the Plug-in device.”

Nearly 10 years later, Watkins’ camp is happy to remain a DLG partner.

“We are delighted to extend our partnership with Direct Line Group and are looking forward to working with the team to help facilitate innovative and market-leading AI-driven solutions,” Watkins commented this time around.

Meanwhile Steve Williams, DLG head of telematics and EV (electric vehicle) strategy, had this to say: “We are pleased to extend our contract with Trakm8 and look forward to seeing the partnership extend to over 10 years.

“Providing value to customers is a top priority for us, and by working together with Trakm8 we can continue to deploy telematics solutions to keep drivers on the road for less.”

[skinny] 18/3/2024 13:26

Dividends?

[nellynell] 18/3/2024 12:16

Well that won't be enough either so here's to many more years of dividends to come :-)

[pander45] 17/3/2024 17:26

I expect a 250 offer coming in best and final.

[wba1] 17/3/2024 12:24

nellynell;
that article demonstrates the traction that the DLG management spin has gained. The cause of the woes was not cat events or even property values; it was underreserving which impacted both accident and prior years. They were forced to substantially strengthen prior year reserves (an effect which flows straight to the bottom line) when other major insurers such as Aviva and Allianz (LV) were able to smooth their profit profile because they had more fat in the prior year reserves. That is why case reserves are set at a conservative value plus a margin (commonly 5% but sometimes more) because it enables the good years to smooth profits in the bad years by releasing some fat out of prior year reserves. Yes, inflation was unexpectedly bad but other insurers had enough in reserve to avoid the problem.

I remain a DLG holder (although I sliced half my holding as previously disclosed) but DLG management do themselves no favours and risk credibility by not publicly addressing the reserving issue. They may have plugged the hole now but that does not answer the question of what they have done to address reserving process and claims management.

[huckers] 17/3/2024 11:22

Posted on the AJ Bell site.

Direct Line Insurance Group PLC suitor Ageas SA has looked to win support of its own largest shareholder, China’s Fosun, in its bid to acquire the FTSE 250-listed insurer, the Sunday Times reported.

Hans De Cuyper, chief executive of Brussels, Belgium-based Ageas, is flying to China over the weekend to meet Fosun representatives.

Fosun owns 10% of Ageas.

Sky News on Thursday reported Ageas is facing opposition from one of its own leading shareholders for the Direct Line bid. Sky reported that a top 10 investor in Ageas is canvassing the views of fellow shareholders in an attempt to halt its efforts to buy Direct Line.

Ageas on Wednesday described its fresh bid approach for Direct Line as ‘compelling217;.

De Cuyper said the improved possible offer ‘delivers substantial cash proceeds to Direct Line shareholders, whilst ensuring they benefit from the material value creation that we believe the combination of the UK businesses of Ageas and Direct Line will deliver’.

Direct Line said the latest proposal, received March 9, comprised 120 pence in cash and one new Ageas share for every 28.4 Direct Line share.

At the closing share price on March 8, the day before the proposal was received, this implied a value of 237p per Direct Line share. The offer would value all of Direct Line around £3.07 billion.

Ageas said the new offer valued each Direct Line share at 239p, as per closing share prices on Tuesday.

Direct Line announces annual results on Thursday.

[hades1] 17/3/2024 09:38

Looks like they don’t have enough shareholder support to increase the bid?
Explains the share price reaction

[carpingtris] 17/3/2024 09:17

On the back of that they'd surely now know how much it'll take? Why go on a journey for funding without knowing how much is needed.

Let's hope that news article has credible substance.

[carpingtris] 17/3/2024 09:14

Yes hopefully a third and final more realistic offer.

[tuftymatt] 17/3/2024 09:13

Thanks Skinny.

Looks more likely than not a 3rd offer is coming then as otherwise why bother making the trip.

Good luck all 👍🏻

[laurence llewelyn binliner] 17/3/2024 08:09

A very interesting week or 2 coming up here, fingers crossed for a dividend, a years miss does hurt any income portfolio dragging averages down, see what the new man comes back with for holders..The quickest way to restore strength to the share price IMO would be to reinstate the dividend, in turn protecting the company from bidders or securing a stronger bid..

[tuftymatt] 17/3/2024 07:51

I have seen a headline this morning saying the boss of Ageas has gone to China to sort out funding for the purchase. Anyone have access to the full story?

Good luck all 👍🏻