Monday 27 March 2017

Insurers take legal advice over RSA's broker package

INSURANCE

Laura Noonan

Laura Noonan

A NUMBER of major insurers are taking legal advice after rapidly-growing RSA bought the renewal rights to the personal insurance business of one of Ireland's largest independent brokerages.

The news comes less than a month after RSA's 123.ie agreed to buy the renewal rights for personal insurance sold by Culleton Insurance, which operates eight branches across Wexford.

Culleton has already written to all its customers telling them that they can have a renewal offer from 123.ie when their current policies expire.

Those who accept will be offered a renewal by 123.ie only -- even if their current policies are with other insurers who Culleton has historically done business with.

Sales branches

One insurer has already written directly to its Culleton customers pitching them a renewal from that insurer through another local brokerage of its direct sales branches.

It is understood that the insurer was threatened with legal action.

A number of other insurers are also understood to be taking legal advice on whether they can contact their Culleton customers and offer them renewals.

"It would be very unusual for an independent broker to be bought out by one of our competitors," one senior insurance industry source said.

"We're trying to find out where we stand."

RSA spokesman Pat Nally yesterday stressed that the deal was "good for customers" since they will have the option of a competitive renewal offer from 123.ie.

Asked about the reasons for buying the Culleton renewal rights, Mr Nally said it was part of RSA's "wider strategy" for "sustainable profitable growth".

RSA has been Ireland's fastest growing insurer in recent years, snapping up renewal rights for 170,000 policies through its 2010 deal to buy the online insurer 123.ie for €65m.

Mr Nally declined to say whether the insurer was in the market for further Culleton-style deals, saying they would evaluate any potential acquisition on a "case by case basis".

Culleton boss Ciaran Culleton could not be reached for comment last night.

It is understood that the brokerage will continue to trade, largely focusing on corporate business.

Irish Independent

Promoted articles

Also in Business