Royal & SunAlliance (R&SA) will remain a major player in the household market despite losing 40% of its book to HBOS subsidiary St Andrews.

R&SA UK chief executive Duncan Boyle vowed: "We have a relationship with 50% of the building societies in this country. We intend to keep it that way and we are happy with the vast majority of those relationships. We have some people who know how to do this kind of business very well."

R&SA had a deal to underwrite £400m of gross written premium for Halifax General Insurance, the broking arm of HBOS. The deal, which was due to run until June 2005, has been terminated and the policies will now be underwritten by St Andrews. Earlier this year, Halifax took claims in-house from R&SA.

Boyle said the release of capacity would not have an impact of staff. "For some time HBOS has been doing nearly all the work on claims and processing," he said.