Direct Line results don’t hook investors

FTSE 250 insurer Direct Line Group (LON:DLG) saw its share price drop by 2.09% to 313.70p (as of 13:10 GMT) after it reported an 11.4% decline in pre-tax profits for the year ended 31st December. The value of in-force policies for the period fell by 1.2% but those of the company’s own brands increased by 2.2%.

CEO Penny James commented: “Despite the many challenges we faced in the year as a result of the Covid-19 pandemic, we traded well and prioritised support for our customers, our people and local communities. Own brands policies grew by 2.2%, and our model of disciplined underwriting delivered a combined operating ratio of 91.0%. This has enabled us to return capital to shareholders during the year and today declare a final dividend of 14.7 pence per share, up by 2.1% over 20191, and announce a share buyback.

“I am proud that our people, even when working remotely, have continued both to care for our customers and to help us build an insurance company of the future. Thanks to their commitment we have made great progress on our transformation programme, designed to drive a step change in our competitiveness and deliver profitable growth. As a small thank you we are awarding all employees shares worth £350.

“We are a business that is proud to deliver strong returns to shareholders and to challenge itself to be a force for good. We chose to invest £93 million in a range of measures to support our customers, our people and local communities. We also want to do everything we can to tackle climate change and last year committed to set science-based targets to reduce our carbon emissions.

“Turning to the year ahead, we feel confident that we can build on the momentum we’ve created and become a tech and data driven insurance company of the future with our customers at its heart“.