Direct Line Group

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Direct Line Insurance Group plc
Company typePublic limited company
IndustryInsurance
FoundedFebruary 2012; 12 years ago (2012-02)[1]
Founders
HeadquartersBromley, England, UK
Area served
United Kingdom
Key people
  • Danuta Gray (Chairman)[2]
  • Adam Winslow (Chief Executive Officer)[3]
Products
Brands
  • Direct Line
  • Churchill
  • Privilege
  • Green flag
  • Direct Line Group Auto Services
  • By Miles
  • Darwin
  • Direct Line for Business
  • Churchill Business
  • Churchill Expert
  • CaHa!
  • Brolly (defunct)
  • Shotgun (defunct)
RevenueIncrease £3,106.0 million (2023)[4]
Decrease £(189.5) million (2023)[4]
Increase £222.9 million (2023)[4]
Number of employees
10,200 (2024)[5]
Subsidiaries
  • UK Insurance Limited
  • UK Insurance Services Ltd.
Websitedirectlinegroup.co.uk

Direct Line Insurance Group plc is a British insurance company based in the United Kingdom, formed in 2012 by the divestment of The Royal Bank of Scotland Group's (RBS) insurance division, through an initial public offering. The company owns a number of insurance subsidiaries, providing various insurance products, including Direct Line and Churchill, Darwin as well as the roadside assistance and vehicle recovery provider Green Flag.

The group is listed on the London Stock Exchange, and is a constituent of the FTSE 250 Index.

History

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The company was originally established in 1985 by Peter Wood and Martin Long, as the insurance division of The Royal Bank of Scotland Group (RBS).[6] It was the first telephone only insurance company in the United Kingdom.[6] In September 2012, the group's then chief executive, Paul Geddes, announced the business was "operating as a standalone insurance company", in advance of a future full divestment from the RBS Group.[7]

The company was the subject of an initial public offering (IPO) in October 2012.[8] RBS sold a 30% share of the business in the IPO, and sold a further 17% in March 2013, reducing its holding in the business to 48.5%.[9] RBS sold a further 20% in September 2013,[10] and sold the remainder of its holding in February 2014.[11]

Direct Line sold its TRACKER Network UK telematics business to the private equity firm Lysanda in February 2014.[12] In September 2014, it was announced that Mapfre would acquire the Italian and German businesses of Direct Line, for a sum of €550 million.[13] The company also made a number of tough financial decisions in 2014, including abandoning some lines of business, making redundancies, and closing 14 of their 27 offices in the United Kingdom.[14]

In February 2019, Direct Line announced it would be appointing chief financial officer Penny James as the CEO.[15] In January 2023, Jonathan Greenwood become acting chief executive after James agreed with the board to step down after two successive profit warnings and a dividend cancellation.[2]

In February 2024 it was reported that the Belgian insurer, Ageas, was considering a bid of around €3.1bn for the company.[16] In March 2024, Ageas announced no offer would be made.[17]

In November 2023, Direct Line Insurance Group announced that they set to cut about 550 jobs as part of a turnaround plan aimed at saving £50 million ($64 million) in 2025. The reductions would eliminate about 6% of its roughly 9,000 employees.[18]

Operations

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The group owns a number of general insurance brands operating within the United Kingdom, including Direct Line, Direct Line for Business, Churchill, Privilege, Darwin and Green Flag. Direct Line is a company that specialises in selling insurance and other financial services, sold directly to consumers by telephone and the internet.[19]

Subsidiaries

[edit]

Darwin

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Darwin was founded in 2019 and led by Sumit Bahukhandi. The company only sells through price comparison websites, initially Moneysupermarket, and is built in the Amazon Web Services cloud. It uses a different pricing model to other companies in the group, and acts as a test bed for new ideas.[20][21][22]

Direct Line for Business

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Direct Line for Business was founded in Leeds in September 2007, and as of December 2020 has 811,000 customers.[23] Since 2010, the company has been led by Jasvinder Gakhal, who has been the director since 2014.[24][25] The company appointed Claire Sadler as marketing director in October 2017.[26]

Direct Line for Business used PricewaterhouseCoopers to improve their product,[27] and in July 2018, the firm launched a new advertising campaign, with Saatchi and Saatchi London.[28]

In the summer of 2019, Direct Line for Business announced that it was cosponsoring the creation of click and mortar pop up shops at ten locations across the United Kingdom, with cosponsors Amazon, Square, and the small business support network Enterprise Nation. The shops offer twenty small online brands the chance to sell their products, meet customers and experience selling on the High Street for the first time.[29][30][31]

References

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  1. ^ Alex Brownsell (9 February 2012). "RBS Insurance division to rebrand as Direct Line Group". Marketing. Retrieved 3 September 2012.
  2. ^ a b Ralph, Oliver; Smith, Ian (27 January 2023). "Direct Line chief executive steps down after profit warnings". Financial Times. London. Archived from the original on 27 January 2023. Retrieved 28 January 2023.
  3. ^ "Direct Line's new boss is insurance 'royalty' — but can he turn the firm around?". The Times. 21 January 2024. Retrieved 1 March 2024.
  4. ^ a b c "Preliminary Results 2023" (PDF). Direct Line Group. Retrieved 21 March 2024.
  5. ^ "Direct Line Group". Insurance Business Magazine. Retrieved 12 February 2024.
  6. ^ a b "Halifax opens fire in motor cover war". The Daily Telegraph. London. 10 January 2001.
  7. ^ "Direct Line nears RBS separation". BBC News. 3 September 2012. Retrieved 3 September 2012.
  8. ^ "Direct Line IPO 'priced to go' at 175p". The Telegraph. 11 October 2012. Retrieved 20 December 2012.
  9. ^ Steve Slater (13 March 2013). "RBS races ahead with Direct Line sell-off". Reuters. Archived from the original on 6 March 2016. Retrieved 24 June 2013.
  10. ^ "RBS makes £630m from sale of 20% of Direct Line". BBC News. 20 September 2013. Retrieved 20 September 2013.
  11. ^ "RBS set to make £1bn from remaining Direct Line stake". BBC News. 26 February 2014. Retrieved 26 February 2014.
  12. ^ "BRIEF-Direct Line completes sale of UK tracker network". Reuters. 5 February 2014. Archived from the original on 6 March 2016. Retrieved 23 February 2015.
  13. ^ Spain's Mapfre to buy Direct Line's German, Italian units for $700 million. Reuters, 25 September 2014
  14. ^ Scott, Matt (14 March 2017). "Inside a Turnaround: The Direct Line story". Managers.co.uk. Retrieved 1 March 2024.
  15. ^ "Insurer Direct Line names Penny James CEO". Reuters. 26 February 2019. Archived from the original on 27 February 2019. Retrieved 1 July 2019.
  16. ^ "Why Ageas buying Direct Line makes sense now". Insurance Post. 29 February 2024. Retrieved 1 March 2024.
  17. ^ "Ageas SA/NV announces no offer will be made for Direct Line Insurance Group plc | Ageas". www.ageas.com. Retrieved 11 November 2024.
  18. ^ "Bloomberg - Are you a robot?". www.bloomberg.com. Retrieved 11 November 2024. {{cite web}}: Cite uses generic title (help)
  19. ^ "Halifax opens fire in motor cover war". The Daily Telegraph. London. 10 January 2001.
  20. ^ Croucher, Martin (5 March 2019). Direct Line to target price comparison sites with Darwin launch. The Insurance Post.
  21. ^ Flinders, Karl (19 September 2019). Direct Line built an insurtech it can tweak a thousand times a day. ComputerWeekly.com
  22. ^ Flinders, Karl (07 October, 2019). Public cloud computing is early on its journey to core of the bank - Darwin in the cloud. ComputerWeekly.com
  23. ^ Direct Line Group Company Overview. NimbleFins
  24. ^ (27 July 2017). Secrets of my success: Jazz Gakhal, head of Direct Line for Business. The Evening Standard.
  25. ^ Jackson, Suzy (27 Sept, 2017). Meet the MD: Jasvinder Gokhal, Direct Line for Business. BQ Live.
  26. ^ Taruc, Paolo (30 Oct, 2017). Direct Line for Business appoints new marketing director. Insurance Business magazine.
  27. ^ Case study: micro SME insurance market. PWC.co.uk
  28. ^ Direct Line 'Keeping up with your world' Saatchi - Work.
  29. ^ Powney, Mark (13 August 2019). Amazon Cardiff Experiment Facilitates Online Shop High Street Experience. Business News Wales.
  30. ^ Hawthorne, Joe (9 August 2019). Amazon behind new pop-up shop opening in Edinburgh's Waverley Mall. Edinburgh Evening News.
  31. ^ Keyes, Daniel (4 June 2019). Amazon is launching a yearlong “Clicks and Mortar” pop-up initiative in the UK. Business Insider.
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