Credit hire group Auto Indemnity has won a three-year deal to supply replacement vehicle services to the RAC's 1.5 million policyholders.

The agreement catapults Auto Indemnity into the big league of accident management service providers, after it became Direct Line's preferred supplier to its 2.7 million motor policyholders last month.

Adrian Palmer, chief executive of Auto Indemnity, said the RAC deal is another significant step in its development. He added that the bespoke service provided to RAC customers will be handled by a dedicated team within Auto Indemnity's national call centre.

Eddie Ryan, director of legal services at RAC, said: “We selected Auto Indemnity for its ethical policy, and its protocol agreement with the Association of British Insurers coincides with the RAC's position as the motorist's champion.”