...Direct Distribution Gaining Importance: The trend toward establishing specialist direct insurers, mainly to cover motor business, has led to high growth in the direct distribution channel over the past few years, but also to increased competition. The direct channel should nevertheless benefit from rising gross written premiums (GWP) in the motor market, which should lead to most direct insurers achieving (or returning to) profitability. Fitch Ratings expects the direct distribution channel's share of total German business to increase further, not just because of the fast-growing motor direct business but also because of non-direct insurers expanding into direct distribution with non-motor lines and above market- average growth of the life direct business. High Cost Efficiency: A key element of the success of the direct distribution channel is the high cost efficiency, for both non-life and life direct distribution. Not only are acquisition cost ratios lower than for traditional channels,...
