Performance Ratio Benchmarking in UK Property Insurance 2007

Performance Ratio Benchmarking in UK Property Insurance 2007

Introduction

The report provides a detailed analysis of the performance ratios of the top 10 UK property insurers. It analyzes the loss, expense and combined ratios of these players and compares these ratios to their premium income movement.

Scope

Loss, expense and combined ratio figures for the top 10 UK property insurers GWP data for the top 10 UK property insurers

Highlights

The average combined ratio of the top 10 leading UK property insurers increased by 1.5 percentage points in 2006, as a result of increases in both the average loss ratio and average expense ratios. As discussed above, the average loss ratio rose by 0.1 percentage points and the average expense ratio rose by 1.4 percentage points.

Reasons to Purchase

Benchmark your performance against your competitors using Datamonitor's loss, expense and combined ratio information Understand the average ratio experience of the top ten UK property insurers

DATAMONITOR VIEW 1
CATALYST 1
SUMMARY 1
ANALYSIS 2
The average loss ratio of the top 10 property insurers increased by 0.1 percentage points in 2006, with Direct Line, Zurich and Norwich Union recording the biggest reductions 2
The average loss ratio of the top 10 property insurers increased by 0.1 percentage points 2
Norwich Union, Direct Line and Zurich recorded strong loss ratio reductions 2
St Andrew's, NIG and Royal & SunAlliance recorded high loss ratio increases 2
The average expense ratio of the top 10 property insurers increased in 2006, with Norwich Union and AXA recording the largest individual increases 4
The average expense ratio of the top 10 property insurers rose by 1.4 percentage points in 2006 4
Norwich Union, AXA and Lloyds TSB saw their expense ratios increase, but they achieved GWP growth 4
Four of the top 10 property insurers achieved expense ratio reductions 5
The average combined ratio of the top 10 property insurers rose in 2006, with Norwich Union, AXA and NIG seeing the largest increases 7
Among the top 10 UK property insurers, the average combined ratio rose by 1.5 percentage points in 2006 7
Norwich Union, AXA and NIG recorded high combined ratio growth 7
Three insurers were able to defy the property market trend and reduce their combined ratios 8
APPENDIX 11
Definitions 14
Average 14
Weighted average 14
Earned premiums 14
Gross premium 15
Net premium 15
Written premiums 15
Loss ratio 15
Expense ratio 15
Combined ratio 15
Further reading 15
Ask the analyst 16
Datamonitor consulting 16
Disclaimer 16
List of Tables
Table 1: Premium income compared to change in loss ratio for the top 10 UK property insurers, 2005-06 4
Table 2: Change in premium income compared to change in expense ratio among the top 10 property insurers, 2005-06 7
Table 3: Change in premium income compared to change in combined ratio for the top 10 UK property insurers, 2005-06 10
Table 4: Property insurance premium income by competitor for the top 20 UK property insurers, 2005-06 11
Table 5: Loss ratio for the top 20 UK property insurers, 2005-06 12
Table 6: Expense ratio for the top 20 UK property insurers, 2005-06 13
Table 7: Combined ratio for the top 20 UK property insurers, 2005-06 14
List of Figures
Figure 1: Direct Line, Zurich and Norwich Union saw the best decreases in loss ratio in 2006 3
Figure 2: St Andrew's was the only insurer to successfully reduce its expense ratio and at the same time increase its property insurance GWP in 2006 6
Figure 3: Direct Line and Churchill saw the biggest reductions in combined ratio in 2006 9