Last checked at 28 Feb 2017 07:00
28 February 2017
Saga plc
Statement regarding Ogden Rate decision
Saga plc ("Saga" or "the Group"), the UK's specialist in products and services for life after 50, provides the following update on the UK Government's decision to move the Ogden Rate to -0.75% from 2.5%.
The UK Government first announced the decision to launch a consultation process on a potential downgrade to the Ogden Rate in 2012. In line with its prudent approach to reserving, Saga has therefore held a specific amount within its reserve margin in anticipation of a reduction in the Ogden Rate.
Given the size of the rate change, there will be a one-off, pre-tax impact on profit of £4m on the Group's results for the year ended 31 January 2017. This will not impact the Board's deliberations regarding the proposed final dividend recommendation and the Group remains well capitalised.
Saga's older demographic provides the Group with a defensive advantage, with lower claims frequency generating less exposure to large and small bodily injury claims, and to periodic payment orders (PPOs). The Group does not expect the Ogden rate change to have a material impact on its financial outlook.
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For further information please contact:
Saga plc | |
Tim McCall, Director of Corporate Affairs | Tel: 07753561862 |
Email: tim.mccall@saga.co.uk | |
Duncan Browne, Investor Relations Manager | Tel: 07710440528 |
Email: duncan.browne@saga.co.uk | |
MHP Communications | |
Tim Rowntree/Simon Hockridge | Tel: 020 3128 8100 |
Email: saga@mhpc.com |
Notes to editors
Saga is a specialist in the provision of products and services for life after 50. The Saga brand is one of the most recognised and trusted brands in the UK and is known for its high level of customer service and its high quality, award winning products and services including cruises and holidays, insurance, personal finance and publishing. saga.co.uk