Insurer wins tender for Lloyds TSB's motor book
UKI Partnerships, part of Royal Bank of Scotland Insurance, has won the tender to underwrite the £300m Lloyds TSB motor book.
Though the business will be broked through Screentrade, the majority of the account is expected to be placed with UKI. The announcement surprised analysts, who were expecting the business to be placed outside the banking sector.
The deal will run from the beginning of 2005 when the current contract with Churchill expires.
The deal was announced in the week Lloyds TSB General Insurance saw its half yearly profits increase by £2m on the back of strong growth in underwriting income and telephone and internet sales.
But the group saw a sharp drop in broking commission as a result of a £24m fall in income from creditor insurance and a £20m fall in other commissions.
Managing director Phil Loney said: "The business is showing growth in pre-tax profits as we expand our market share in home insurance and drive forward our direct business."
The company registered increases in premium income from home underwriting from £198m to £218m, and in creditor underwriting from £52m to £55m. Health underwriting showed a drop from £22m to £16m.
On the broking side the company saw commissions in creditor drop from £190m to £166m, with home dropping from £14m to £12m; health rose fractionally from £8m to £9m.