Travel insurance slump cuts profits at Moneysupermarket

Price comparison website Moneysupermarket has reported a sharp slump in annual profits after coronavirus restrictions wiped out demand for travel insurance.

The financial services platform, which helps customers compare deals, reported a 24% fall in pre-tax profits, to £87.8m, following “negligible” revenues from its TravelSupermarket site.

The pandemic also limited the appetite for deals on home, car and life insurance, and the demand for new credit products, hampered also by tighter lending criteria.

In Moneysupermarket’s home services, such as energy tariffs, there have been fewer people using the site to switch because many of the deals offering the biggest savings have been removed from the market as energy companies raise bills.

Peter Duffy, the chief executive of Moneysupermarket Group, which also includes MoneySavingExpert.com, said the company has continued to help “millions of UK households save on their bills” and provide “indispensable financial advice throughout the Covid-19 pandemic”.

“The business is resilient, and our dividend reflects our confidence for the future,” he said. “Our job now is to encourage consumers to engage with us more and save on more of their bills. We will use our data better so consumers find our sites easier to use and are reminded when there are savings available to them.”

The company, once known for its controversial advertising campaigns, warned that its outlook for the year ahead would depend on how soon travel restrictions are lifted. Its adjusted earnings tumbled by 24% to £107.8m last year, and may fall further to £96.4m in 2021 if restrictions are maintained.

The company will require a “strong and rapid recovery” in demand for travel insurance and borrowing if it hopes to reach £128.8m, which is the top end of its guidance for the year ahead.