Suncorp says it can maintain margins and market share in the highly competitive personal motor area by keeping a lid on claims costs.

In its results for the year ended June 30, the insurer reported a 5.3% lift in gross written premium for personal motor compared with the previous year, while household insurance rose 9.2% and compulsory third party went up 9.6%.

Acting CEO Chris Skilton told analysts last week Suncorp is very aware of entrants in the direct online space offering a low-cost but low-service proposition, and that Suncorp’s Bingle brand is countering that.

“However, not everybody wants the low service, so it is a limited market,” he said.

Mr Skilton says Suncorp, like the rest of the industry, is achieving good margins in personal motor but competition is intense so he’s expecting rate increases to be more “CPI-like”.

“We think we can certainly match that through greater efficiencies in the claims costs line,” he said.

“It will be interesting to see if these new entrants have their risk selection right. Have they got the scale and efficiency on the claims cost side to match what we can do?”

Suncorp Group Executive Personal Insurance Bernadette Inglis says the AAMI brand has been achieving unit growth and margin growth, and motor books are well within the 8-10% margin range in short-tail business.