The sale of Groupama UK has been stopped by its French parent company.
In a shock move, managing director of personal and commercial lines Tim Ablett said the French head office had given the UK company a five-year guarantee that it would keep the business.
Ablett said he was not surprised by the move. "Nothing shocks me in this business anymore," he said.
It is understood that the move has been made in reaction to the current hard market. A senior market analyst said: "Groupama can obviously see there is money to be made in the UK market with rates hardening and want to make hay while the sun shines."
HSBC analyst David Hudson agreed that the French parent could be eyeing up a UK market with excellent prospects or that Groupama could not realise the full price it wanted for the business.
Chairman and chief executive Tony Lancaster and commercial insurances managing director Stephen Hartigan have left the company. Ablett said a new chief executive was being sought and an announcement would be made in a few weeks.
Ablett has taken on the commercial lines of the business, along with his existing personal lines portfolio.
Temporary charge of the company will be taken by Jean Paul Bouquin who came over from the French business in October 2001 to advise on the portfolio transfer.
