RSA exits personal lines motor shifting renewals to Swinton
RSA has confirmed pulling out of the UK personal lines motor market, worth £120m in gross written premium, and signing up with Atlanta-owned Swinton on a renewals deal.
Market speculation that RSA would exit the line was first revealed by Insurance Age last week.
RSA will continue to offer new business and renewals until 31 August with Swinton, part of the Ardonagh Group, taking up renewals as of 1 September.
The insurer did not release a figure for the potential payment from Swinton, but stated proceeds would be received as policies were renewed and were “not expected to be material”.
The MoreThan brand is being kept for home and pet business.
Alongside the development, RSA’s telematics offerings – Smart Wheels and Low Miler – are going into run-off with final new business sales by 30 April and final policy renewals by 31 May. After these dates, there will be an option for customers to be introduced to Swinton.
People
The shift will result in restructuring costs of £35m for RSA.
Insurance Age understands that while 500 people, are connected to this part of the business – 10% of RSA’s employees – they are often supporting it in addition to other role functions.
It is further understood that while there is the likelihood of redundancies, given the lengthy transition period there will be opportunities to place the majority of those affected into other parts of the provider and keep any total job losses as low as possible.
Ken Norgrove, chief executive of RSA UK & International said: “Our primary focus now is on delivering an orderly transition that supports our colleagues and customers.
“We have incredibly talented people working in this business, and we’re committed to treating them with fairness and respect.”
Actions
Canada-headquartered Intact Financial Corporation bought RSA in mid-2021.
Intact’s UK & International division, where RSA sits, had a combined operating ratio of 106.2% in personal lines in 2022.
Overall the unit posted a 97% COR and Intact is targeting a low 90s combined ratio for the UK&I.
Charles Brindamour, chief executive of Intact, said of the disposal: “When we completed the acquisition of RSA, we were clear that we would take necessary actions to drive sustainable outperformance in UK&I.
“Today’s announcement represents a further step in delivering against our strategic roadmap to optimise our footprint around personal lines home and pet, and our commercial and speciality lines businesses.”
Partnership
Ian Donaldson, chief executive of Ardonagh Retail, said: “We have worked in close partnership with RSA for a number of years, including the previous successful transfer of the renewal rights of their direct van line of business, and believe Atlanta and Swinton Insurance is the perfect home for motor.
“We look forward to working with RSA over the coming months on a smooth transition and to welcoming their 170,000 customers to our ever-expanding group.”
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