Queensland-based insurer Youi says it has started a “strategic review” of its underwriting deal with agency Blue Zebra.

Youi’s Australian business is dominated by direct personal lines, but it underwrites Blue Zebra’s car, home and commercial insurance products after signing a five-year agreement in March 2020.  

The agency was established in 2018, initially backed by Zurich, aiming to bring personal lines back to brokers and using technology to increase efficiency. It has grown rapidly and expanded its product suite – and has ambitions to grow further in Australia and overseas. Youi owns a minority stake in the business.

On Friday, Youi’s South African owner Outsurance published results for the six months to December 31. Personal lines written through Blue Zebra delivered a $12 million operating profit, compared with an $11 million loss in the previous corresponding period. 

Business insurance written through Blue Zebra made a $1 million loss, compared with a $2 million loss a year earlier. Youi flags a “slowdown in new business volumes following corrective pricing actions in the [Blue Zebra] broker channel”.

It says the strategic review “was prompted by Youi’s desire to focus more attention and capital on its core business, which is its own direct channel that offers much-needed competition in Australia’s personal lines insurance market”. 

Blue Zebra MD Colin Fagen says it is business as usual for the agency and no formal decision has been taken by Youi.

“We’re looking at all our options – other insurers are talking to us – and we see it as potentially a good opportunity to expand our product range,” he told insuranceNEWS.com.au.

Overall, Youi reported gross written premium of $1.03 billion for the six-month period (up 25%) and operating profit of $133 million (up more than 100%).