The company was originally established in 1985 by Peter Wood and Martin Long, as the insurance division of The Royal Bank of Scotland Group (RBS).

[11] Direct Line sold its TRACKER Network UK telematics business to the private equity firm Lysanda in February 2014.

[12] In September 2014, it was announced that Mapfre would acquire the Italian and German businesses of Direct Line, for a sum of €550 million.

[13] The company also made a number of tough financial decisions in 2014, including abandoning some lines of business, making redundancies, and closing 14 of their 27 offices in the United Kingdom.

[14] In February 2019, Direct Line announced it would be appointing chief financial officer Penny James as the CEO.

[15] In January 2023, Jonathan Greenwood become acting chief executive after James agreed with the board to step down after two successive profit warnings and a dividend cancellation.

The company only sells through price comparison websites, initially Moneysupermarket, and is built in the Amazon Web Services cloud.