Sheilas' Wheels owner esure said it does not expect motor premiums to start rising again until the first quarter of the 2015 "at the earliest"

The Surrey-based car and home insurer, which employs 1,400 people and has over 1.5 million customers, said pre-tax profits edged up 0.4% to £57.1 million in the six months to June 30 due to disciplined underwriting in competitive motor and household insurance markets.

But the group said overall gross written premiums fell 1.9% to £260.4 million during the period, reflecting the competitive marketplace.

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The business added it expects gross written premiums in the second half of this year to be lower than the same period last year, and adds it does not expect the UK motor market to improve until 2015 at best.

According to data last week from breakdown group the AA, average car premiums fell 19.3% in the year ending June 30 - the largest 12 month decrease since the group started compiling these figures two decades ago.

Over the last two years the car insurance industry has seen rates plunge as regulators have clamped down on fake whiplash claims as well as inflated hire car and garage repair bills that have padded out premiums.

Esure said group trading profit fell 6.4% largely as a result of winter storms that hit the country at the beginning of the year and which cost £3 million more than expected during the period.

The firm said its motor profits were broadly flat compared to a year ago, while its home business was up 12.1% reflecting good risk selection.

The group owns half of the price comparison website Gocompare, with trading profit from this business down 19.4% to 5.4 million over the period due to the cost of a new TV ad campaign, although the cash dividend it received from the joint venture more than doubled to £6.8 million.

City watchdog the Financial Conduct Authority warned last month that price comparison sites covering car and household insurance failed to give consumers a true picture of the products they bought when it came to levels of cover and excess charges.

Esure, established by chairman Peter Wood in 2000, took its half-year payout to 5.1p a share from 2.5p, helped by the payment of a special dividend.

The firm said the rise in its combined operating ratio - a measure of underwriting profitability, with anything below 100% representing a profit and anything above representing a loss - to 90.9% from 89.6% last year was in line with guidance and came despite harsh weather in the first quarter.

The group said that it is on track to deliver a full-year combined operating ratio broadly similar to that achieved in the first half of 2014, assuming normal weather for the remainder of the year.