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BSM to join forces with motor insurer

John Shepherd
Tuesday 20 September 1994 23:02 BST
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BSM, a household name in driving instruction, is close to forming a joint venture with one of the UK's biggest motor insurers, as yet unnamed, as part of a plan to develop its non-core activities, writes John Shepherd.

BSM wants to offer cheaper insurance policies to inexperienced drivers on condition they take another driving test with them. Most of BSM's business is from learner drivers, particularly teenagers who are classed as high-risk by insurance companies.

The move coincides with a marked demographic shift. The number of 17-year-olds in the UK is set to increase for the first time in several years in 1995. Therefore, BSM wants to extend its relationship with driving pupils beyond the test stage. On average, learner drivers take 90 minutes of lessons for every year of their age, but few go on to take advanced courses.

BSM's development plans also involve training schemes for company car drivers. A contract to run courses has just been signed with SmithKline Beecham, the pharmaceuticals company, which has 1,800 company car drivers.

Other initiatives include targeting 6 million disabled people, and classroom and off-road driving courses in secondary schools. A pilot scheme, sponsored by Norwich Union, has been running for the past few months in secondary schools in the North-east.

BSM said it had continued to out-perform competitors. It said its new business rose by 1.6 per cent in the 12 months to June, set against a 1.6 per cent decline in applications for provisional licences. The number of franchise instructors on its books rose by 6.4 per cent to just under 2,200.

BSM, which was floated last year, also announced an underlying 8 per cent improvement in taxable profits for the first six months of this year from pounds 2.1m to pounds 2.2m. Shareholders will receive a maiden interim dividend of 2.15p - some 11 per cent higher than the 1.93p the company would have paid last year if it had been quoted.

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