The impact on the insurance industry of the Saga/AA deal is still unclear

The AA/Saga merger is set to complete next week, creating a financial services giant worth over £6bn. But the impact on the insurance industry is still unclear.

How the merged companies will operate has yet to be fully outlined – no surprise given the owners are secretive private equity firms.

What has been said so far is that the AA and Saga will continue to operate in their separate fields, with their separate brands, but will cross sell to each other’s customer base.

But there are question marks over how the deal will affect AA’s relationship with its panel of insurers.

The broker has not ruled out re-casting or even disbanding its panel, while Saga is certainly looking to get a foothold on the AA’s panel, which is its is not currently on.

Observers also suggest that AA’s panel members could also find themselves facing pressure on commissions given Saga’s reputation as a tough negotiator.

So far Saga and the AA have giving little. For the rest of the insurance industry it is a question of watch and wait. The real impact of the merger may not be felt for some months.