Royal & SunAlliance has strengthened its position in the group risk market after winning exclusive rights to Zurich Life's £30m book of group employee benefits business on a renewal basis.

The deal follows Zurich Life's decision to withdraw from the corporate risk market and instead focus on individual benefits business.

Zurich Life spokeswoman, Debbie Isaac, said the insurer felt it was unlikely to become a major player in the market. She said it has chosen to offer its 4% market share to RSA as it operates on the same basis and has the capacity to manage the business.

Mike Warr, director of IFA corporate business at RSA, said it was offered the business by Zurich Life on an exclusive basis.

The former Zurich Life business will increase RSA's share of the group risk market to almost 20%.

RSA has existing interests in group life, income protection and critical illness employee benefit schemes, 99% of which are supplied through Independent Financial Advisors.

Sales of RSA's products increased 45% in the two years up to 1999, from £23m to £34m. Total premium income was £148m.

Under the terms of the agreement, Zurich Life clients will be offered

preferential terms by RSA upon renewal.

Warr said: “We have put in place

a fast track process to ensure the smooth transition to RSA for Zurich Life's group risk clients.

“We believe this market offers excellent potential for continued future growth given the anticipated changes in welfare reform and the increasing importance of flexible benefit packages for employees.”

RSA is planning to target small businesses, as this is a market that

is expected to grow significantly in the next 10 years.