CGU spinning a bold web deal

CGU this week made a bold move to become a software provider after acquiring a 50% stake of internet start-up company, IQUO.

The new technology company was launched just a year ago and helps insurers develop the capacity to provide online motor cover.

The first phase of the deal, which was for an undisclosed sum, will see IQUO developing internet solutions purely for CGU.

Once these are up and running, CGU will begin promoting them to rival insurers, corporate partners and brokers.

Initially the two companies wish to offer insurance quote-and-buy facilities. But their plan is to provide a system that allows customers to update their own policies, cutting the workload for the provider drastically.

CGU UK executive director and newly appointed IQUO board member Phil Loney said: "One of the important things about this deal is control. A lot of the software houses building solutions have clients clambering for attention. This is a way of making sure that we get our own solutions to market quicker."

Loney does not believe the fact that CGU is a rival will prove a hindrance in selling the systems to other insurers. He said: "There have to be technological solutions and people are more concerned that they work efficiently than who is providing them."

The move is a further e-commerce step for the composite insurer and follows the launch of its internet consultancy Silliconwharf and auction portal bluecycle.com.

Joining Loney on the board is IQUO managing director John McLaughlin and CGU's director of strategic systems Mike Maher. Loney believes the move will open up opportunities for CGU and its partners to benefit from systems such as Wireless Application Protocol, digital television, and palm top technology.

McLaughlin said: "This venture with CGU Insurance will enable us to take significant steps forward in the development of the business and utilise the growing potential of e-commerce."