Royal and SunAlliance (R&SA) achieved an 85% retention rate in its commercial book, although the competitive market took its toll on the insurer's underwriting result.

For the first six months of 2006, R&SA's total UK commercial underwriting result deteriorated from £65m, compared to £57m in the same period last year.

R&SA UK chief executive Bridget McIntrye said the competitive climate had led to a 11% drop in commercial premiums, but new business premiums in the six months were up 17% compared to last year.

"We also saw a 65% rise in second quarter sales compared to the first quarter.

"Client retention is very important to both myself and Brendan [McManus]," she added. The insurer signed £225m in new deals and will see a further £20m in 2007.

She said the ethos of claims "technical mastery", combined with the favourable weather, had meant the insurer's claims ratio was now 61%, making a claims savings of £150m.

This was £25m more than the benefit her former employer, Norwich Union, gained from good weather in the first half, though McIntrye admitted it was "from a smaller base than NU".

On motor pricing, the insurer would look to make "moderate increases where appropriate". Overall, More Th>n growth was up 14%, and R&SA was working on future motor growth through initiative Drivetime and discounted premiums on eco-friendly cars.