The full details of the Saga and AA merger have come to light this week as four senior directors left the AA and a new group management structure was put in place.
In an exclusive interview with Insurance Times, group commercial director John Potter outlined the merged company’s new structure, employment policy and direction.
He also sought to quell speculation about job losses and claimed that the merger was a “growth story”.
Potter said Saga and AA would maintain separate brands, but with numerous cross-selling opportunities.
“Saga will remain an over 50s brand and the AA will remain an all-ages brand. As for the AA panel, the only change will be adding Saga insurance as an underwriter for motor.
“Saga will compete on a level-playing field. For the AA, this provides an additional insurance company to choose from.”
Saga would also be reconsidering its roadside assistance partnership with AXA, given that the AA had its own similar product, said Potter.
The company will spend £15m in providing the AA with the in-house insurance database and marketing technology that has been credited for Saga’s aggressive growth strategy.
Potter said Saga has grown 80% in turnover and increased its staff numbers by 28% since its private equity buy-out three years ago.
He said: “Only 10% of roadside customers buy insurance from the AA. Saga built its business on database marketing and we want to bring that database skill set to the AA.
“Saga has the greatest penetration in terms of multi-products held by customers.”
Potter refused to talk numbers but said significant growth is anticipated for the AA once it adopted the new technology.
Potter rejected allegations by the GMB union that up to 2,000 jobs could be lost, arguing there were plans to grow the AA’s call centres as well as increase roadside patrols.
As revealed on Instimes.co.uk last week Kevin Sinclair, head of insurance, and his colleagues, financial director Paul Wolf, human resources director Martin Sawkins, and information systems director Trevor Didcock have left the company.
The team was replaced at a group level by senior members of Saga, with the exception of Andy Royle, who is now head of risk and compliance and had previously worked for the AA.
Following the merger Andrew Goodsell was named chief executive of a new holding company Acromas. He will also retain his position as boss of the Saga brand while Andrew Strong will be heading up the AA brand.
The AA has already named its new executive committee while Saga is currently undergoing restructuring and has not yet made official appointments.
The merged company’s new board of directors consists of two members from the three private equity firms behind the deal – Charterhouse, Permira and CVC – which hold stakes respectively of 38%, 21% and 21%. Staff members have been given a total of 4% of the company..