The director presents the strategic report for Coverwise Holdings Limited (the "Company") and its subsidiaries ('the Group') for the year ended 31 March 2024 and 31 March 2023.
The Group has delivered strong growth since its inception, and this has continued during the year ending 31 March 2024 and 31 March 2023. Revenue increased by 16%, generating profit before taxation of £3.9m in 2024 from £3.1m in 2023. The Group’s net current assets increased to £7.4m in 2024 from £4.1m in 2023 and the net assets position at the year end 2024 at £12.0m from £8.5m in 2023. The increase in market activity is reflected in the financial statements and compared to the previous year.
The Group is well positioned to deal with any future changes in market conditions. As previously forecast, the UK market for foreign travel has proved resilient, despite high inflation and rising interest rates. In the year ahead, the market may experience a reduction in the average holiday cost as disposal income is pressurised by increasing accommodation costs, but we do not currently expect demand for foreign travel to weaken significantly. Consequently, we are forecasting a positive financial performance in the coming twelve months.
Financial key performance indicators
The director considers that the key financial performance indicators are those that communicate the financial performance and strength of the Company, these include turnover, profit before tax and net assets.
The KPI´s are in line with the director´s expectations and reflect the investment made to ensure further service developments that they believe will drive the Group´s revenue growth in future years.
The director considers and evaluates the risks of the Group on a regular basis. The principal risks and uncertainty faced by the Group are as follows:
Competitive risk
Competitive risk is that the Group struggles to engage distributors, offers uncompetitive insurance premiums and/or fails to address the challenges posed by its competitors. The risk relates to competitor activity and the need to maintain competitive advantage through ongoing innovation in our product line. The demand for project-based enterprise applications software and solutions has historically fluctuated based upon a variety of factors, including the business and financial condition of our customers and on economic and financial conditions that affect the key sectors in which our customers operate such as services firms, architecture, and engineering. The management believe that they have adequate resources, people and systems to deal with external events.
Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for that other party by failing to discharge an obligation. This risk mainly pertains to the ability of our customers to pay us for products and services provided. The Group does not believe that it is exposed to counterparty credit risk due to the Risk Transfer agreement that is in place with carriers and the payment in advance operating model.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with short-term financial liabilities. The Group aims to mitigate liquidity risk by managing cash generation by its operations and applying cash collection targets throughout the Group. The Group, based on monthly management information provided, monitors its solvency position to ensure that it does not become exposed to liquidity risk and the Board will act as required should this become a matter requiring attention.
Market risk
Market risk arises from the Group's use of interest bearing, tradeable and foreign currency financial instruments. It is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of the changes in interest rates (interest rate risk), foreign exchange rates (currency risk) and other market factors (other price risk).
Legislative risk
Legislative risk is that related to the local regulatory requirements and also those stipulated by the European Union. As part of our risk management approach, the director continues to monitor regulatory developments in current markets and take appropriate measures should the regularity risks in a particular market change significantly.
At this time, we are unaware of significant risks that might be reasonably expected to cause the level of market activity to deteriorate and the post balance sheet period has seen further improvements in the Group’s trading activity and financial performance.
Approved by the Board and signed on its behalf by:
The director presents his annual report and the audited financial statements for the financial year ended 31 March 2023 and 31 March 2024.
The Group met the definition of a medium-sized group as at 31 March 2022. Accordingly, the financial year ending 31 March 2023 represents the first year in which consolidated financial statements are being prepared. On an exceptional basis, the Group has chosen to present both the 31 March 2024 and 31 March 2023 financial years within the same set of consolidated financial statements.
Principal activities
See the strategic report for details of principal activities.
The Group results for the year are set out on page 9.
No ordinary dividends were paid by the Parent company, 'Coverwise Holdings Limited' in the current year and the prior year.
The Company's subsidiary, 'Coverwise Limited' was licensed by the Gibraltar Financial Services Commission on 3 September 2010 as a general insurance intermediary and has invested in a Protected Cell company in Malta. The Company has regulatory permission to trade in the United Kingdom and, via its Maltese Cell, within the European Union.
Going concern
The director has assessed the balance sheet and likely future cash flows at the date of approving these financial statements. The director notes the Group has been profitable and has a strong net assets position. Based on these factors and the Group's cash position at the year end and to the date of signing these financial statements, the director has a reasonable expectation that the Group has adequate resources to continue in operational existence and to meet its financial obligations as they fall due for at least 12 months from the date of signing these financial statements. Accordingly, the director continues to adopt the going concern basis in preparing the financial statements.
The director who served during the financial year and up to the date of this report, was as follows:
During the year 2024 and 2023, the Group continued to invest in research and development activities aimed at enhancing its operational capabilities and improving customer experience. The Group has undertaken significant development work on a new Policy Administration System, designed to streamline core insurance processes, improve policy lifecycle management, and support future product innovation.
A dividend payable to Coverwise Holdings Limited of £2,500,000 was declared on 31 July 2024 and paid on 1 August 2024. The Maltese Cell declared and paid a dividend of €350,000 on 5 September 2024 and 9 October 2024, respectively.
An interim dividend payable to Coverwise Holdings Limited of £5,000,000 was declared on 04 June 2025 by Coverwise Limited.
On 25 March 2025, the redeemable preference shares were redeemed at par.
There are no other subsequent events that would require adjustment or disclosure in the financial statements.
In our opinion the financial statements of Coverwise Holdings Limited (the 'Parent company’) and its subsidiaries (together the ‘Group’):
give a true and fair view of the state of the Group's and of the Parent company's affairs as at 31 March 2024 and 31 March 2023 and of the Group's profit for the years then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland"; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements which comprise:
the Group statements of comprehensive income;
the Group balance sheets;
the Company balance sheets;
the Group and Company statements of changes in equity;
the Group statement of cash flow; and
the related notes 1 to 28.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's and Parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.
Other information
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
We considered the nature of the Group’s industry and its control environment, and reviewed the Group’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of the director about their own identification and assessment of the risks of irregularities, including those that are specific to the Group’s business sector.
We obtained an understanding of the legal and regulatory framework that the Group operates in, and identified the key laws and regulations that:
had a direct effect on the determination of material amounts and disclosures in the financial statements. This included UK Companies Act 2006, Companies act 2014 (Gibraltar) and Financial Services Act 2019 / Financial Services (Insurance Distribution) Regulations 2020 (Gibraltar).
do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty. This included the Income Tax Act 2007.
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.
In addition to the above, our procedures to respond to the risks identified included the following:
reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
enquiring of management concerning actual and potential litigation and claims, and instances of non-compliance with laws and regulations; and
reading minutes of meetings of those charged with governance and reviewing correspondence with regulators in jurisdictions where subsidiaries are licensed.
Report on other legal and regulatory requirements
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and of the Parent company and their environment obtained in the course of the audit, we have not identified any material misstatements in the strategic report or the director's report.
Matters on which we are required to report by exception
Under the Companies Act 2006 we are required to report in respect of the following matters if, in our opinion:
adequate accounting records have not been kept by the Parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the Parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of director's remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
We have nothing to report in respect of these matters.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
There were no items of other comprehensive gains or losses for the current or prior year other than those included in the Statement of Comprehensive Income above, accordingly no other Statement of Comprehensive Income is presented.
As permitted by s408 Companies Act 2006, the Company has not presented its own profit and loss account and related notes. The Company’s profit for the year was £767,588 (2023: £1,018,249).
Coverwise Holdings Limited (“the Company”) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The registered office is Hayes & Co, 2nd Floor, Oliver House, 77-79 High Street, Steyning, West Sussex, United Kingdom, BN44 3RE.
The Group consists of Coverwise Holdings Limited and all of its subsidiaries.
Principal activities
See the strategic report for details of principal activities.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements have been prepared under the historical cost convention, modified to include certain items at fair value.
The financial statements are prepared in sterling, which is the functional currency of the Company. Monetary amounts in these financial statements are rounded to the nearest £.
The Company only, meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it in respect of its separate financial statements, which are presented alongside the Group financial statements. Exemptions have been taken in relation to financial instruments and presentation of a cash flow statement.
As permitted by s408 of the Companies Act 2006, no separate profit and loss account or statement of comprehensive income is presented in respect of the Parent Company. The profit attributable to the Company is disclosed in the footnote to the Company's balance sheet.
Basis of preparation
Coverwise Holdings Limited ("the Company") is the ultimate parent company of Coverwise Limited and the Coverwise Cell (the "Cell" or "Coverwise Cell"). The group's aggregate turnover and balance sheet total exceed the thresholds for small groups under the UK Companies Act 2006. Therefore, the Company is required to prepare consolidated financial statements in accordance with UK company law.
The material accounting policies adopted are set out below. They have been applied consistently throughout the financial year and to the preceding financial year, unless otherwise stated.
The Group financial statements consolidate the financial statements of the Company and its subsidiary undertakings drawn up to 31 March 2024. The results of subsidiaries acquired or sold are consolidated for the periods from or to the date on which control passed.
Subsidiaries are entities controlled by the Group. Control exists where the Group is exposed to or has the rights to variable returns from its involvement with the investee and has the ability to use its power over the investee to affect its returns. Unrealised gains and losses on transactions with subsidiaries or associates are eliminated. Transactions with associates are eliminated to the extent of the Group's interest in those entities in preparing the consolidated financial statements.
The acquisitions of subsidiaries are accounted for using the acquisition method. The consideration transferred is measured as the fair value of assets given, liabilities incurred or assumed and equity instruments issued by the Group at the date of exchange. Any costs directly attributable to the business combination are booked to the profit or loss as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed, meeting the conditions for recognition under FRS 102, Section 19 "Business Combinations", are recognised at their fair value at the acquisition date, irrespective of the extent of any non-controlling interest.
The excess of the consideration transferred over the fair value of the Group's share of the identifiable net assets acquired is recorded as goodwill. Subsequent changes in the fair value of consideration transferred or identifiable assets, liabilities and contingent liabilities assumed are adjusted where they qualify as measurement period adjustments. The measurement period is the period from the date of acquisition to the date the Group obtains complete information about facts and circumstances that existed as of the acquisition date and is subject to a maximum of one year.
In the Parent company financial statements, the cost of a business combination is the carrying value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination.
The director has assessed the balance sheet and likely future cash flows at the date of approving these financial statements. The director notes the Group has been profitable and has a strong net assets position. Based on these factors and the Group's cash position at the year end and to the date of signing these financial statements, the director has a reasonable expectation that the Group has adequate resources to continue in operational existence and to meet its financial obligations as they fall due for at least 12 months from the date of signing these financial statements. Accordingly, the director continues to adopt the going concern basis in preparing the financial statements.
Revenue recognition for the regulated entities (Gibraltar and Malta) are as follows:
Revenue represents amounts receivable for commission from the sale of travel insurance.
Commission income is the difference between the gross premiums receivable by the Group and the net premium payable to insurers. Commission is recognised as revenue in the year in which it falls due.
Revenue is recognised to the extent that the Group obtains the right to consideration in exchange for its performance. Revenue is measured at the fair value of the consideration received, excluding discounts, rebates and other sales taxes or duty.
Turnover from information technology and management services are provided under contracts to the extent that there is a right to consideration and is recorded at the fair value of the consideration received or receivable. Where a contract has only been partially completed at the balance sheet date turnover represents the fair value of the service provided to date based on the stage of completion of the contract activity at the balance sheet date.
Dividend income
Dividend income from subsidiaries is recognised when the shareholders' rights to receive payment have been established (provided that it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably).
Research expenditure is written off as incurred. Development expenditure is also written off, except where the director is satisfied as to the technical, commercial and financial viability of individual projects. In such cases, the identifiable expenditure is capitalised as an intangible asset and amortised over the period of three years, during which the Group is expected to benefit. Provision is made for any impairment.
Residual value represents the estimated amount which would currently be obtained from disposal of an asset,
after deducting estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the statement of comprehensive income.
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in the Profit and Loss Account as described below.
Non-financial assets
At each balance sheet date, the Group reviews its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss.
If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
Financial assets
An asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.
Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.
For financial assets carried at amortised cost, the amount of impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.
For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.
Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
Financial assets and liabilities are only offset in the balance sheet when, and only when there exists a legally enforceable right to set off the recognised amounts and the Group intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets are derecognised when and only when the contractual rights to the cash flows from the financial asset expire or are settled, or the Group transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or the Group, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party.
Basic financial liabilities, including creditors, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the Group’s contractual obligations expire or are discharged or
cancelled.
Equity instruments issued by the Group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the Group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
Short-term benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the Group is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Defined contribution schemes
The Group operates a defined contribution scheme. The amount charged to the Profit and Loss Account in respect of pension costs and other post-retirement benefits is the contributions payable in the financial year. Differences between contributions payable in the financial year and contributions actually paid are included as either accruals or prepayments in the balance sheet.
The Group as lessee
Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.
The Group as lessor
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.
Transactions in foreign currencies are recorded at the rate of exchange at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the Balance Sheet date are reported at the rates of exchange prevailing at that date.
Exchange differences are recognised in the Profit and Loss Account in the period in which they arise except for exchange differences arising on gains or losses on non-monetary items which are recognised in the statement of comprehensive Income.
Interest receivable and similar income
Interest receivable and similar income are recognised when it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount on initial recognition.
Interest payable and similar expenses
Interest payable and similar expenses are charged to the statement of comprehensive income over the term of the debt using the effective interest method, so the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
In the application of the Group’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
In the opinion of the director, there are no critical accounting judgments made by the Group in the current and prior year.
Key sources of estimation uncertainty
Consolidating components
Coverwise Limited established a cell within Artex Insurance Brokers Europe PCC Limited ("Artex PCC"), a Protected Cell Company incorporated in Malta. The Cell operates as a travel insurance intermediary and arranges policies in a number of countries within the European Union. The Company holds 100% of the Cell's ordinary shares.
The Cell operates under the license held by the Artex PCC and is legally and financially separate from other cells within the PCC. The assets and liabilities of the Cell are strictly segregated from those of other cells, even in liquidation. However, in the event of the Cell's liquidation, creditors may have recourse to the assets of the Artex PCC under Maltese law and the Cell Agreement.
Management has determined that the Company controls the Cell, via Coverwise Limited. This determination is based on Coverwise Limited's two-thirds majority representation on the Cell Committee, the decision-making body for the Cell, and is a management judgment. This conclusion satisfies the definition of control under FRS 102 9.4 and 9.5. The Cell Committee's responsibilities include strategic decision-making regarding acquisitions, disposals, capital expenditure, dividend policy, budget approval, and financing, all within the regulatory permissions granted to the Artex PCC.
The investment in the Cell is accounted for using the cost model less impairment, as permitted under FRS 102.9.26 for investments in subsidiaries.
Estimation of useful life
The useful life used to amortise intangible assets relates to the expected future performance of the assets acquired and management’s estimate of the period over which economic benefit will be derived from the asset. The useful life is determined by management at the time the software is acquired and brought into use and is regularly reviewed for appropriateness. The useful life represents management’s view of the expected term over which the Group will receive benefits from the assets. Intangible assets are deemed to have a useful economic life of three year.
The average monthly number of persons (including directors) employed by the Group and Company during the year was:
Their aggregate remuneration comprised:
No contribution was paid to a defined contribution pension scheme in respect of the highest paid director in the current and prior year.
The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
Following the substantive enactment of the Finance Act 2021, effective 1 April 2023 the applicable corporation tax rate is now 25% (for companies with profits over £250,000) and continues to be 19% (for companies with profits of £50,000 or less). Companies with profits between £50,000 and £250,000 pay tax at the main rate reduced by a marginal relief providing a gradual increase in the effective Corporation Tax rate.
Details of the Company's subsidiaries at 31 March 2024 and 31 March 2023 are as follows:
Other debtors include amounts due from insureds for £712,723 in 2024 and £988,277 in 2023 and other taxation and social security of £270,624 in 2024 and £91,575 in 2023.
See note 27 for details of amounts owed by related parties.
Trade debtors above relate to IBA trade debtors for both the current year and the prior year.
Other creditors include amounts due to insurers of £5,691,860 in 2024 and £5,213,641 in 2023. The Group´s obligation to remit funds to insurers is dependent upon the date the insured remits the payment of the premium to the Group. Amounts due to insurers therefore differs from amounts due to insureds, included within debtors, and amounts collected from insureds, included within cash at bank and in hand.
Other borrowings comprise of preference shares classified as liability for £262,262 in 2024 and £nil in 2023.
See note 27 for details of amounts owed by related parties included in other creditors.
Other borrowings comprise of preference shares classed as liability for £nil in 2024 and £262,262 in 2023.
The preference shares were redeemed at par in March 2025.
Cash at bank includes, premiums collected from insureds for £5,651,785 in 2024 and £5,375,718 in 2023. Such balances are not available for the Group's own purposes.
The following are the major deferred tax liabilities and assets recognised by the Group and Company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund. The unpaid contributions due to the fund (included in other creditors) at 31 March 2024 were £19,158 and at 31 March 2023 were £9,892.
At the reporting end date the Group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The commitments of £117,812 in 2024 and £55,581 in 2023 relate to amounts payable for the office space at Suite 836 Europort, Gibraltar.
A dividend payable to Coverwise Holdings Limited of £2,500,000 was declared on 31 July 2024 and paid on 1 August 2024. The Maltese Cell declared and paid a dividend of €350,000 on 5 September 2024 and 9 October 2024, respectively.
An interim dividend payable to Coverwise Holdings Limited of £5,000,000 was declared on 04 June 2025 by Coverwise Limited.
On 25 March 2025, the redeemable preference shares were redeemed at par.
There are no other subsequent events that would require adjustment or disclosure in the financial statements.
The Company has taken advantage of the exemption under FRS 102 Section 33 not to provide information on related party transactions with other wholly owned companies within the Group.
Included within other debtors of the Company is a loan owed by the director of £334,313 (2023: £nil) at year end, unsecured and interest is charged at the Bank of England base rate plus 2.5% p.a. (2023: 2.5% p.a).
Included within other creditors of the Company is a loan owed to the director of £nil (2023: £499,223), at year end, the loan is repayable on demand, unsecured and interest is charged at the Bank of England base rate plus 2.5% p.a. (2023: 2.5% p.a). Interest paid on the loan was £nil in the current year (2023: £33,969).
During the current year fees of £110,000 (2023: £89,000) were paid directly to certain directors of the Group.
During the year the Company earned an amount of £37,500 (2023: £28,125) in commission from Southdowns Insurance, a company that is controlled by a person who is a related party to the director.
During the year the Company paid an amount of £7,200 (2023: £3,600) for accountancy fees to Southdowns Insurance, a company that is controlled by a person who is a related party to the director.
Included within debtors of the Company is an amount of £116,250 (2023: £nil) due from Southdowns Insurance, a company that is controlled by a person who is a related party to the director, at year end,
During the year the Group earned an amount of £656,508 (2023: £627,548) in commission from Southdowns Insurance, a company that is controlled by a person who is a related party to the director.
Included within debtors of the Group is an amount of £684,448 (2023: £964,731) due from Southdowns Insurance, a company that is controlled by a person who is a related party to the director at year end,