Royal & SunAlliance (R&SA) has insisted it will remain a strong player in the affinity market, despite pulling out of its home insurance partnership with Halifax Bank of Scotland (HBOS).
The termination of the deal - by the end of 2003 - will release around £160m of capital, which R&SA will use to shore up its capital position. The decision is another step in its attempt to reshape the group, R&SA said.
R&SA UK chief executive Duncan Boyle said: "We expect to remain a key player in the household corporate partnership sector, maintaining a significant presence in segments where we can build mutually profitable relationships, adding value through our core skills of underwriting and claims handling.
An R&SA spokesman said the termination has been reached in a "mutual agreement".
He said: "R&SA's strategy is to remain a strong player in selected UK intermediated personal lines, building mutually profitable relationships with partners whose strategy and customer philosophy support its business model, which is to add value by taking full responsibility for underwriting and claims handling."
From the start of 2004 HBOS household policies will be underwritten by HBOS subsidiary, St Andrews.
HBOS general insurance managing director Howard Posner said: "We've enjoyed a long and successful partnership with R&SA. However, the strategy of both organisations has developed to the extent that this change is a logical move for both.
"Because the administration, pricing and claims management of this business has for a number of years been successfully undertaken within HBOS, we do not expect there will be any impact on the excellent relationships we have with our customers."
