Direct Line parent, The Royal Bank of Scotland Group (RBS) has acqired Churchill Insurance Group for £1.1bn in a deal which makes it the third largest general insurer in the UK.
Direct Line parent, The Royal Bank of Scotland Group (RBS) has acquired Churchill Insurance Group for £1.1bn in a deal which makes it the third largest general insurer in the UK.
Insurance Times was the first to report that RBS had been in talks to buy Churchill on 27 February.
Fred Goodwin, group chief executive of RBS, promised to retain both brands, Direct Line and Churchill, and ensure "minimal disruption" to customer-facing staff. He also indicated that the broker-only insurer, NIG, would be retained.
However speculation surrounds the future of Churchill's founder Martin Long.
Goodwin said: "Churchill is an excellent acquisition for us; it will fit well alongside Direct Line, and will bring several advantages to the Group.
"In direct channels, Churchill's strength in home insurance will balance Direct Line's strong position in motor insurance. Both Churchill and Direct Line have expertise in the distribution of general insurance products through partners, under their brands.
"Churchill also owns NIG, a highly regarded company. In addition to distributing motor and home insurance through brokers, NIG has a strong presence in commercial insurance products for SMEs, broadening the general insurance offering of RBS."
Oswald Grübel, co-chief executive officer of Credit Suisse Group, said "The strength of The Royal Bank of Scotland's proposal together with the commercial fit with its direct insurance operation were central factors behind our decision to sell.
"The transaction provides Winterthur with more financial flexibility for selective growth and strengthens the capital base of Winterthur Group."
