(Reuters) - Insurer Hastings Group said on Friday its loss ratio for the year would inch towards the higher end of its target range as third-party property damage costs rose, even as it reported higher quarterly gross written premiums.
Shares of the company fell nearly 5 percent to 206.55 pence in early trade. They plunged over 40 percent last year when the industry battled extreme weather conditions in Britain.
The mid-cap insurer, which operates mainly in the auto insurance market, said claims inflation remained high with repair costs and further increases in third party property damage costs being the main drivers.
If that continues, the loss ratio - the amount it spends on claims compared to how much it earns on premiums - would move towards the higher end of the 75 percent to 79 percent target range for the year, the underwriter said.
For the first quarter, Hastings’ gross written premiums rose to 235.5 million pounds from 226 million pounds a year earlier as its customer base grew.
Active customer policies inched up by 3 percent to 2.75 million and its market share climbed 20 basis points despite tough competition in the industry.
The cost of a comprehensive motor insurance policy fell 1 percent in Britain in the first quarter, pushed down by uncertainty around the rate used to calculate compensation for personal injuries and the Civil Liability Bill, a survey showed earlier this month.
“The motor market continued to be competitive in the first quarter of 2019, but as always, we will trade through this environment with discipline,” Toby van der Meer, Hastings’ chief executive officer, said.
Reporting by Muvija M and Yadarisa Shabong in Bengaluru; editing by Gopakumar Warrier