RSA completes personal lines exit with sale of UK operations to Admiral

Insurer RSA and parent company Intact Financial Corporation have this morning (7 December 2023) announced the sale of RSA’s direct personal lines operations – comprising home and pet lines – to Admiral Group. 

The move follows the conclusion of a strategic review and will also see RSA exit its home and pet partner and broker contracts in the UK, completing its exit from the UK personal lines market. 

RSA had previously indicated that it was potentially looking to exit the personal lines market. In March, the insurer announced its exit from the motor market and, following its acquisition of Direct Line Group’s (DLG) brokered commercial lines operations in September, noted that it was exploring strategic options with respect to RSA’s UK personal lines business – including a sale.

That sale has now materialised, having been approved by the board of directors at both Intact and Admiral, and is expected to close by the end of Q1 2024. 

RSA said that its UK direct personal lines operations represented approximately £165m worth of annual premiums that Admiral would acquire, alongside renewal rights, brands and employees. RSA will retain claims reserves, with these being run off over time.

Around 300 RSA employees will move to Admiral as part of the deal, which will also see Admiral acquire the More Than brand.

Ken Norgrove, chief executive at RSA, explained: “We recognise the important work of our personal lines colleagues in building RSA’s leading home and pet businesses. 

“I’m confident that Admiral’s shared values and track record in delivering excellence for customers makes them a perfect fit for our UK direct personal lines business. Our focus is on ensuring an orderly transition that supports our customers, colleagues and partners.” 

Strategic rationale 

The sale price for RSA’s direct home and pet operations included a cash consideration of £82.5m, with the potential for a further payment of up to £32.5m, subject to the fulfilment of certain retention thresholds. 

RSA added that, in aggregate, the proceeds from the sale to Admiral and the release of capital backing for the UK personal lines business over time are expected to amount to a benefit of £350m. 

In addition, the insurer said it planned to exit its UK home and pet partner contracts in the UK, worth around £515m. The firm explained that it was exploring options to either transfer these arrangements to other parties or let the contracts expire over time. 

Charles Brindamour, chief executive officer at RSA owner Intact, added: “The exit from the UK personal lines market sharpens RSA’s focus as a leading UK commercial and specialty lines player, accelerating our ability to deliver sustainable outperformance in the UK and Ireland segment.”

Milena Mondini de Focatiis, chief executive at Admiral Group, added: “Increased scale in home and pet not only supports Admiral’s diversification strategy, but also supports our aim to provide customers with a stronger multi-product offering, choice and convenience. We look forward to welcoming our new colleagues and the additional expertise they bring.

“Our capability and culture will ensure More Than and RSA customers that join Admiral will continue to receive the high quality cover and customer service they expect. Consistency and continuity for our new and existing customers during this migration will be our priority.”