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Sabre Insurance Group PLC

Sabre Insurance Group plc Delivered in line with expectations across all financial and operational measures

Sabre Insurance Group plc (LON:SBRE), one of the UK’s leading private motor insurance underwriters, reports its full year results for the year ended 31 December 2018.

Financial Highlights

2018

2017

Gross written premium

£210.0m

£210.7m

Net earned premium

£188.2m

£186.9m

Net loss ratio

48.5%

46.5%

Expense ratio

22.1%

22.0%

Combined operating ratio

70.6%

68.5%

Adjusted profit before tax

£61.9m

£63.9m

Adjusted profit after tax

£50.1m

£53.3m

Profit before tax

£61.4m

£55.5m

Return on tangible equity

54.4%

81.8%

Financial year total dividend per share

20.0p

N/A

Solvency coverage ratio

213%

160%

Solvency coverage ratio (post dividend)

161%

160%

Return on opening SCR

82.0%

92.1%

· Continued strategy of focusing on underwriting profitability over growth

· Delivered in line with expectations across all financial and operational measures, following the exceptionally strong 2017

· Disciplined approach to pricing, with premiums increased to reflect claims inflation, has supported a combined operating ratio ahead of mid 70%’s target whilst delivering flat year on year gross written premiums, in line with guidance

· Continued strong organic capital generation with a year-end solvency coverage ratio of 213% (pre dividend)

· The Board has declared a final ordinary dividend of 6.8p and a special dividend of 6.0p

· Prudent approach to capital management reflected in post dividend solvency coverage ratio at the upper end of our target range

Operational Highlights

· Continued testing and roll-out of innovative new rating factors and data sources

· Successful soft launch of new direct van product, Insure2Drive Van, in Q4 2018

· Completed transition to a new hybrid cloud IT infrastructure

· Maintained very high levels of staff retention, with 88% of staff survey respondents recommending Sabre as a good place to work

· Testing innovative machine learning and AI approaches across the business

Geoff Carter, Chief Executive Officer of Sabre, said:

“I am pleased to report on our first full year as a listed business. Against the backdrop of what have been competitive underlying market conditions during the year, we have stuck to our core principle of focusing on underwriting profitability over volume growth. This has ensured that we maintained our market-leading underwriting performance, with a combined operating ratio better than our target, and continued to deliver strong organic capital generation. The strong capital generation, driven by our profitability, has allowed us to return a proportion of excess capital generated through a proposed special dividend, whilst maintaining our solvency ratio above our preferred range of 140-160%. From an operational perspective, we have continued to make excellent progress, building on our competitive strengths with the introduction of new rating factors and data sources while exploring new, complementary product lines and maintaining our focus on customer service.

Looking ahead, there remains uncertainty around the market dynamics, but we will continue to take a prudent approach to monitoring and responding to potential changes and trends in our industry, taking pricing action only when speculation and opinion becomes fact.

We are confident that by maintaining our absolute focus on underwriting discipline – treating volume as an output not target – we will continue to deliver strong profitability and attractive, consistent returns for shareholders and are well positioned to take advantage of growth opportunities at the appropriate time. “