Insurer escapes weather battering
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.INDEPENDENT Insurance yesterday won back its reputation as the darling of the general insurance sector when it announced profits up by 22 per cent in 1998, one of the toughest insurance years in memory.
Unlike bigger rivals battered by severe weather claims, Independent expanded its business - measured by net earned premium - by 14 per cent to pounds 392.7m. The shares jumped 12 per cent yesterday to 280p, a return to favour after an autumn profits warning which saw the price drop 12 per cent.
Shareholders were taken aback by the November warning. A pounds 15m hit for weather damage claims in the autumn was unexpected, and the group also recorded a pounds 5m charge for an abortive diversification into life insurance. Most analysts yesterday upgraded their recommendations from "neutral" to "buy" as it emerged that the reaction to November's profits warning had been overdone.
Brighter prospects in general insurance, caused by a determined hike in premium rates by the large insurers, also helped the stock.
Michael Bright, the chief executive, has won plaudits for positioning Independent as a "contracyclical company" that bucks trends set by other insurers. The insurer was founded in 1986 as part of a buy-in backed by 3i and Foreign & Colonial. Mr Bright exited its personal lines business and concentrated on adding value, rather than cutting premiums, for commercial customers.
The company has withdrawn from price-driven commodity business, and won a loyal customer base by offering services such as risk management and health and safety to commercial insurance buyers.
This "partnership approach" has helped the accuracy of Independent's underwriting. It has increased premiums from pounds 26m 12 years ago to pounds 550m.
Mr Bright yesterday bought half a million shares, stressing his confidence. More than 300 employees are now in a position to cash in shares bought as part of a "Share Save" scheme, splitting pounds 8m between them.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments