Co-op general insurance records 50% rise in profit

by Gill Montia

Story link: Co-op general insurance records 50% rise in profit

Co-operative Insurance’s general insurance division will be reporting 2007 profit in excess of £500 million this week, a 50% rise on 2006.

The impressive increase comes even after the insurer settled flood claims to the value of £36 million and marks the completion of a successful modernisation of the general business, prior to which it appears to have belonged more in an episode of Life on Mars than in the modern insurance sector.

According to David Neave, director of general insurance for Co-operative Financial Services: “The rating system was desperately out of date. The claims operation was run out of 18 offices; it wasn’t based on anything much more sophisticated than manila envelopes.”

Mr Neave joined the business in 2005 from Royal & Sun Alliance, since when he has been eradication inefficiencies and changing a system of tied financial advisers and agents.

The Co-op now sells its policies through business partners and via the telephone and Internet, whilst maintaining a small direct salesforce.

In recent years, the group has gained a reputation for its ethical stance and continues to develop products that reward eco-conscious customers.

In 2006, it launched a motor-insurance policy that offset 20% of a car’s carbon-dioxide emissions and there are plans to extend this to all Co-op motor policies.