Claims costs hit Hastings

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Insurer Hastings saw its share price drop earlier this week after warning that claims costs were outstripping premiums paid in the motor and home lines.

The insurer’s trading update for the nine months ending 30 September revealed that its 2018 loss ratio would likely be at the lower end of a 75% to 79% range if claims inflation continues to exceed premium inflation.

The news spooked investors, prompting the Hastings share price to fall 16% yesterday before bouncing back to close on 200p.

Ongoing investment into the insurer’s technology programme, including the continued successful rollout of Guidewire, as well as additional investment in its anti-fraud capability and development of new underwriting and retail pricing models, are all on track to support profitable growth in 2019 and beyond, according to Hiscox.

Toby van der Meer, chief executive officer of Hastings Group, commented: “We have 2.7 million customers, an increase of 4% from last year, which we achieved whilst remaining true to our pricing discipline and increasing premiums in a competitive market.”

“We remain well positioned in a very large market with 31 million cars on the road, growing consumer adoption of digital channels and continued media and regulatory focus on consumer switching.”

“Our focus remains on continuing to profitably grow our successful, technology led business with sophisticated and disciplined pricing at its core. As always, my thanks go to my 3,300 colleagues for what they do for each other and our customers every day.”

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Mark Dugdale is the editor of Claims Media. Mark welcomes articles, letters or feedback from readers and can be reached via mark.dugdale@barkerbrooks.co.uk