Insurance group Hastings has announced plans for a stock market float which is expected to value the company at up to £1.5 billion.

The share sale next month should result in a multi-million pound windfall for founder Neil Utley and other early backers of the company, which launched in 1997 with 50 employees. Its brands including Hastings Direct sell mainly car insurance.

Mr Utley and three others who started the firm own just under half of the shares and are expected to sell at least a quarter of their holdings in the float, which will raise £180 million by selling new shares to pay down debt and enable enable continued growth.

US investment bank Goldman Sachs will also enjoy a huge return less than two years after ploughing in £150m to what was then a loss-making business employing around 750 people. It will also sell at least a quarter of its holding.

Its stake of just below 50 per cent will now be worth as much as five times the initial outlay.

Hastings employs around 1,900 people with its head office in Bexhill, East Sussex and other offices in Newmarket and Leicester. They are also expected to benefit through schemes that will see them receive shares worth hundreds of pounds each.

The firm is led by chief executive Gary Hoffman, who ran Northern Rock after the bank was rescued by the Government.

He stands to benefit too in the float plans, from the boost to the value of equity he holds and potential performance-linked share awards.

Hastings said it held 5.5 per cent of the UK private car insurance market as of June this year, with 1.88 million live customer policies. It has a target of more than 2.5 million by the end of 2017.

The group reported gross written premiums of £483.4m for last year, up 19 per cent on the prior year, though net income fell 11 per cent to £57.5m, despite higher operating profits, as the cost of debt financing rose sharply.