The insurance giant reported a pre-tax profit of £62 million, a notable recovery from a £76 million loss in the same period last year. CEO Adam Winslow attributed the turnaround to ongoing transformation efforts and emphasised the company’s commitment to achieving strategic targets, including £100 million in cost savings by 2025 and a 13% net insurance margin by 2026.
“In the first half of the year, we delivered strong premium growth and returned to profitability. The actions we have taken are beginning to make a difference, but there is more to do,” Winslow stated. He added that the company will continue to push its transformation agenda through the second half of 2024 and into 2025, with a new management team driving these initiatives.
The group saw its gross written premiums surge by 53.5% to £1.84 billion, boosted by its Motability partnership, with underlying growth at 11.4%. While in-force policies declined by 3.1%, Motor margins remained strong with a net insurance margin above 10%. Non-Motor lines outperformed, showing 13.7% growth and an 11.6% margin.
Direct Line’s solvency capital ratio also improved to 200%, enabling the group to declare a 2.0 pence per share dividend. Looking ahead, the company plans to expand its Motor business by increasing visibility on comparison websites and aims to grow its Non-Motor insurance segment by 7% to 10% annually through 2026.
To support these goals, Direct Line has implemented over 50 cost-reduction measures, including limiting non-essential recruitment, optimising media spending, and cutting discretionary expenses. The company has paused investments in Pet, Travel, Creditor, and Select products, reallocating resources to higher-margin areas, and has exited several low-margin partnerships in Travel and Rescue.
These efforts are overseen by a new Central Transformation Office, which has projected a £165 million cost, funded primarily through planned capital expenditures.
