Direct Line Insurance Share Discussion Threads

[essentialinvestor] 03/9/2019 11:26

BOD not falling over themselves to buy atm. Over the years large director buying has often corresponded with decent buying opportunities.

[risa5] 02/9/2019 23:16

DLG Seems very undervalued but with uncertainty about Brexit and volatility there could be more market corrections around the corner and financial stocks such as banks and insurance take more of the brunt as they have done so far.

[meek] 02/9/2019 07:33

Started building a position here, I'm thinking we're close to the bottom now.

[yf23_1] 01/9/2019 18:22

Just for info, I've renewed my DLG car policy and added breakdown recovery (£65). I left RAC because they increased my cover to over £100 from £65 last year and quoted me over £100 this year even though I had changed to a small newer car from an old US import sports car. Now it appears that new customers are given a 40% discount and its nowt to do with the car. So if you're a new breakdown customer be prepared for a £40 hit the next year.

[joshuam] 01/9/2019 04:56

Getting very tempting at these prices, growth and dividend

[fllegend] 22/8/2019 20:07

City analysts and investors have a pretty poor understanding of how insurance businesses work. The share price rises whenever average motor insurance price rises is a perfect example of this. It doesn't take a genius to see premium prices could rise 5% but if claim costs rise 10% the bottom line profitability is gonna be hit. The real number to look for is the COR or Combined Operating Ratio, which is the ratio of all the costs (claims, expenses, commission etc) against gross written premiums. On that measure DLG compares pretty favourably with the cohort, having never exceeded 100% in the recent past. What's more, the latest H1 2019 results showed that the company is accumulating capital to prepare for Brexit, and is now at the very top end of what the regulators recommend for the Solvency Capital Requirement. In essence the company has a massive cash pile, is still growing its own brand policies, and have some very well established brands.

[essentialinvestor] 22/8/2019 16:35

Underwriting should be able to mitigate that at annual renewal. However, yes it looks to be yields weighing on the sector.

[joan of arc] 22/8/2019 16:16

Good point riverman. But the bond prices should be rising and hence they could make capital gains on their historical holdings. Future income might be the issue.

[essentialinvestor] 22/8/2019 15:03

On annual renewal polices like car insurance it really should not make much of a difference. What is happening looks mainly sentiment driven. Their sector is viciously competitive atm, however no real change in that.

[riverman77] 22/8/2019 14:14

Yes you're right, falling interest rates/yields is the main factor behind the sell off. Insurers rely on bond markets to generate investment returns.

[riverman77] 22/8/2019 14:08

I also use direct line as it us cheaper than anything I could find on the comparison sites. As I say, I think this is a big competitive advantage as the comparison sites takes a huge commission. As far as I am aware, only DLG and Aviva have the brand recognition to sell direct.

[essentialinvestor] 22/8/2019 14:08

This is negative yield related imv, investment returns being compressed.

[dmf] 22/8/2019 14:01

looking to add.....however downward trend persists....will wait a while

[jontyone] 22/8/2019 13:56

Just had my car insurance renewal from DLG, with no change in circs over the year, other than getting older, and the premium has increased to just over 25%. I checked other comparison sites and the only one that could better it was Quote Me Happy by a couple of pounds, so I shall stick with them for another year.

[riverman77] 22/8/2019 08:44

I hold LGEN and PHNX. Starting to look at DLG too given recent fall, although generally less keen on car insurers. It's hard to think of an industry with less pricing power - it's very competitive sector and most people will just go for the cheapest deal. That said, DLG doesn't rely on comparison sites which I think is an important competitive advantage.

[garycook] 22/8/2019 08:14

W,Added to my AV,DLG,LGEN,& PHNX holdings today.Also GVC doing nicely.

[wllmherk] 22/8/2019 08:05

Hitting new lows today as I write this which is very disappointing, I suppose these are the vagaries of investing. DLG is, by some distance, my largest holding so these falls are really hurting this year's performance and looking like wiping out this year's overall gains. However, I had a look at the 3-month charts for these, LGEN, AV. and ADM. All very similar except ADM got a bounce on its recent results and AV. appears to be bucking the trend today with interest in its Asia business. The Gov announced their decision on the personal injury discount rate in July which disappointed the industry and this appears to have been the trigger for the recent sell off in insurance stocks. Brexit and trade tensions not helping either but, I would suspect companies such as DLG would be quite resilient in an economic downturn. Overall, I continue to hold and reinvest dividends, if I had spare cash I'd be ploughing some into AV. and LGEN too, both quality companies IMO, no advice intended. wllm

[garycook] 14/8/2019 02:11

W,Totally agree.

[wllmherk] 13/8/2019 18:04

Grabbed a few more today, now my biggest holding. Seems a very low price for a quality company unless I'm missing something? wllm

[2wild] 08/8/2019 15:34

Ex 7.2p div today. Below 300p does seem a good time to buy.

[wllmherk] 08/8/2019 15:27

I certainly agree with recent posters sentiments and have doubled my holding today significantly reducing my average which sat at 368p but, after today's purchase 332p. Happy with that and will hold these for the foreseeable with that rather chunky dividend, not to mention the Specials along the way. wllm

[peteret] 08/8/2019 10:20

This is seriously under priced now

[fllegend] 31/7/2019 09:51

Would agree this is underpriced at the moment. The underlying results are very good, a minor drop in own brand policy numbers in home and motor exacerbated by some partnership exits. However the capital position is very strong at the moment, with a 180% Solvency Capital number. Means the company should be well buffered against any volatility in the financial markets, and there should not be much to fear with regards to plans for future dividend payments.

[wolansm] 31/7/2019 09:21

Drop a little overdone in my view, traders will start buying in for the divi, all in my imagination perhaps.I will stay put.

[woodhawk] 26/7/2019 09:16

Just the normal churn while traders make some money. If I hadn't got so many of these already, I'd be buying more right about now.