Direct writer Churchill has clinched the contract to supply motor insurance to Alliance & Leicester's 5.7 million customers.

The affinity deal will see Churchill's products branded with Alliance & Leicester's livery when they go on sale on August 1 of this year.

Churchill, which last month joined the AA's underwriting panel, will handle underwriting, sales and claims operations for all the product's new business and renewals.

Alliance & Leicester will focus on marketing the product.

The contract boosts Churchill's position in the affinity market, following similar motor deals with Lloyd's TSB, Halifax and Birmingham Midshires.

The direct writer, which is part of the Swiss-owned Winterthur Group, has an additional one million individual motor policyholders.

David Hiddleston, business development director at Churchill, said: "We have a justifiable reputation as the industry's number one outsourcer and know we can offer the bank's customers and staff the very best value for money, coupled with the highest levels of customer service."

Richard Baker, manager of Alliance & Leicester's general insurance division, said it selected Churchill on the basis of its track record as a competitively priced product provider.