The latest update from Allianz;
Financial and strategic highlights:
- Success of joint venture with LV= results in robust COR for the half-year at 91.7%
- GWP and Operating Profit impacted by Covid-19, competitive market conditions and the run-off of certain portfolios
- Allianz Insurance has made payments on 87% of accepted Business Interruption claims related to Covid-19, double the market average
- Motor claims frequency is returning to pre-lockdown levels but premiums are at a five-year low
- Allianz and LV= continue to invest in community engagement and grassroots sport, including rugby and cricket
Jon Dye, CEO, Allianz Holdings said: “I’m proud of what our business has delivered for the first six months of the year. Our half-year results show a very strong Combined Operating Ratio, underlining the solidity of Allianz Holdings and our balanced portfolio of commercial and personal lines business. Four years after the announcement of the joint venture with LV=, these figures demonstrate that the integration has resulted in our business being in an incredibly strong position and this success has enabled us to take the next step in our journey with the creation of Allianz Commercial and Allianz Personal. This simplified structure will align our business to the distinct needs of our customer groups.
“Our people have worked tirelessly this year and I’m incredibly proud of their hard work and commitment.”
In the first six months of the year, Allianz Holdings delivered a very solid Combined Operating Ratio (COR), with an improvement of 1% to 91.7% (HY 2020: 92.7%), emphasising the benefit of a balanced portfolio of commercial and personal business. Gross Written Premiums (GWP) were moderately down on last year by 6% to £1.86bn (HY 2020: £1.98bn), primarily due to the continued impact of Covid-19, some extremely competitive conditions in certain markets as well as the run-off of certain portfolios, while Operating Profit fell slightly by 6% to £169m (HY 2020: £179m).
SLIGHT DECREASE IN GWP
In the first six months of the year, Allianz Insurance saw GWP decrease by 5.6% to £913m (HY 2020: £967m), while the Operating Profit fell by 38.9% to £44m (HY 2020: £72m), and the COR deteriorated slightly to 96.7% (HY 2020: 95.6%).
Within our commercial lines of business, the overall performance has improved. Although overall GWP is down slightly by 6% to £617m (HY 2020: £656m), driven mainly by the continued impact of Covid-19 on the economy, we are starting to see new business increase, as companies are progressively getting back to their pre-pandemic activity levels. In June 2021, we saw a clear uptick in enquiries and broker engagement compared to the same month last year and this is expected to continue. As a result of fewer Business Interruption claims, the COR has also significantly improved for commercial lines, with a 12.7 percentage point improvement to 97.4% (HY 2020: 110.1%), with the most positive developments being seen in Engineering, Construction and Power, which reported a very strong COR performance over the first half of the year.
Our motor fleet products and services have responded well to our customers’ changing needs during the last 18 months and this will remain a focus for the future, as society continues to change the way it travels due to evolution in vehicle technology as well as new ways of working.
Within the Allianz Insurance personal lines business, overall GWP decreased slightly by 5.1% to £296m (HY 2020: £312m) and the COR increased by 3.7% to 94.1% (HY 2020: 90.4%), due to the negative impact of motor books which are in run-off. The Petplan, Allianz Musical Insurance and Home & Legacy businesses – which now form part of Allianz Personal – have all performed well, with Petplan in particular continuing on its strong growth path, helped by the increase in puppy and kitten ownership. Profitability in Allianz Legal Protection also continued to improve following the recent strategic review.
On the claims side, the settlement of Covid-related Business Interruption claims has continued apace. Our claims teams have now issued a final or interim payment in more than 87% of accepted BI claims, compared to a market average of just 43%, a true demonstration of supporting our customers in their moment of need.
Our continuous investment in outstanding claims service also saw the launch of a new digital platform that helps motor repairers procure green parts from our salvage agent and, in a new upgrade for our Claims Hub, present position trackers now allow brokers to follow the progress of their claims live. This claims service is part of our dedication to broker service and has resulted in us being recognised by the Gracechurch Service Quality Marque for the fifth year in a row, which is a unique achievement.