Lloyds TSB: UK Personal General Insurance Competitor Profile 2006

Table of Contents

• CHAPTER 1 INTRODUCTION
  • What is this report about?
  • Who is the target reader?
  • How to use this report
• CHAPTER 2 LLOYDS TSB: UK PERSONAL GENERAL INSURANCE COMPETITOR PROFILE
  • Lloyds TSB' s insurance business is much smaller than its banking operations, but has recorded consistently strong growth
    • Lloyds TSB' s Insurance and Investments division contributed almost £500 million towards the Group' s overall profit in H1 2006
      • Lloyds TSB' s wholesale and international banking business was the principal contributor to Group profits in H1 2006
    • 2005 and 2006 interim results have shown increases in profit and GWP as Lloyds TSB has concentrated on cost reductions
      • In the areas where Lloyds TSB underwrites, it has invested heavily in ' manufacturing' capability and focused on reducing costs
  • Lloyds TSB only underwrites personal lines insurance, and has grown to be the eleventh largest provider
    • Lloyds TSB acts as an underwriter and distributor
    • In underwriting terms, Lloyds TSB had a 2.3 per cent share of the personal insurance market in 2005
      • Although Lloyds TSB' s household book has expanded rapidly since 2001, growth slowed in 2005 and was below average
  • In 2006, Lloyds TSB underwrote more of its own insurance
    • In the first half of 2006, income results varied as the balance between underwriting and broking shifted
    • Lloyds TSB is increasing the amount of household and creditor insurance that it underwrites in-house
  • Lloyds TSB' s general insurance business is largely personal, but it has entered commercial lines
    • Lloyds is looking to grow its commercial business by cross-selling to its business banking customers
    • The company is seeking to offer advice alongside insurance
  • Lloyds TSB distributes under its own name, rather than through insurance brands
    • Lloyds TSB' s distribution strategy largely focuses on cross-selling under its own brand
    • The vast majority of Lloyds TSB' s advertising expenditure goes on promoting home and motor products
    • Lloyds predominantly advertises through direct mail
    • Lloyds has traditionally sold through its branch network, but its direct sales are growing
    • Lloyds TSB has recently entered the corporate partnerships market
  • Summary: Lloyds TSB has adopted a varied and unique strategy
    • Selling to existing Lloyds TSB customers has helped it grow its insurance business rapidly
• CHAPTER 3 APPENDIX
  • Methodology
    • Competitor data
      • GWP versus GEP reporting
      • Major changes in FSA Return categories and their impact
    • Market size
      • Changes in market size information
  • 2005 definitions for lines of business
    • Accident & health
    • Motor
      • Total private motor
      • Private motor comprehensive
      • Private motor non-comprehensive
      • Motorcycle
    • Property
      • Household and domestic all risks.
    • Financial/Pecuniary loss business
      • Total personal financial loss business
    • Total personal
    • Total commercial
  • Ratio analysis by competitor
  • Premium income measures
    • Earned premiums
    • Gross Premium
    • Net Premium
    • Written premiums
  • Current readings
  • Future readings
  • Do you need more information?
  • SPP writing team
  • List of Tables
    • Table 1: Lloyds TSB' s profit before tax, by main business division, H1 2005 to H1 2006
    • Table 2: Lloyds TSB Insurance' s profit before tax and underwriting income, 2005-6
    • Table 3: Lloyds TSB' s growth rates and share of underwritten household GWP compared to the market, 2005
    • Table 4: Lloyds TSB' s personal lines premium income split by line of business, 2001-5
    • Table 5: Key statistics relating to Lloyds TSB' s underwritten personal lines book, 2001-5
    • Table 6: Lloyds TSB' s general insurance income, H1 2006
    • Table 7: Top ten general insurance advertisers, 2003-5
    • Table 8: Lloyds TSB' s advertising spend by line of business, 2005
    • Table 9: Lloyds TSB' s advertising spend by medium, 2005
  • List of Figures
    • Figure 1: Lloyds TSB' s core business is split between three principal divisions
    • Figure 2: Lloyds TSB' s Insurance and Investments division contributed almost £500 million to the Group' s overall profit in H1 2006
    • Figure 3: General insurance contributions to Lloyds TSB' s profit increased between H1 2005 and H1 2006
    • Figure 4: Lloyds TSB' s non-life bancassurance model
    • Figure 5: Lloyds TSB was the 11th largest personal general insurer in 2005
    • Figure 6: Lloyds TSB' s household book did not keep up with the overall market in 2005, but has grown significantly since 2001
    • Figure 7: Growth in Lloyds TSB' s household book has slowed, and GWP fell slightly in 2005
    • Figure 8: Lloyds TSB' s premium income from creditor insurance grew in the first half of 2006, while commissions fell
    • Figure 9: Lloyds TSB was one of the highest-spending advertisers in the general insurance market in 2005
    • Figure 10: Lloyds TSB spent heavily on advertising household and motor products in 2005
    • Figure 11: Over 90 per cent of Lloyds TSB' s advertising expenditure went on direct mail in 2005