Business Irish

Tuesday 17 October 2017

Online insurer sold to UK giant Royal Sun Alliance for €65m

Laura Noonan

Laura Noonan

IRELAND's first online insurance broker has agreed to sell itself to UK giant Royal Sun Alliance (RSA) in a deal worth more than €65m.

Companies Office records show founder Derek Richardson looks set to make more than €35m from the sale, while managing director Andrew Collins looks set to clear €20m.

The deal was announced yesterday and comes 10 years after launched on to an internet-shy market in the summer of 2000.

Costly advertising campaigns helped the online brokerage build up a policyholder count of 170,000 as some €60m of premiums were sold in the year to March.

The bulk of those premiums were under-written by the Irish office of US giant Travelers Insurance under a special discount agreement.

Under the new deal, RSA will take over underwriting of all future policies sold by and will be able to offer rates to's existing book of policyholders on renewal.

RSA is also taking on's branding, online infrastructure and physical offices, as well as the broker's 150 staff and management team.

In a statement, RSA said the "consideration" of €65m being paid included's gross assets of €20m, implying a value €45m for the core business.

It is understood that further earn-outs may kick in depending on the future performance of The latest publicly available figures for show pre-tax profits of €68,000 for the 15 months ended March 2009.


"The price looks a bit high to me," one industry observer said yesterday, though others pointed to the efficiencies RSA could achieve.

RSA said it would become "the second largest general insurer in Ireland" once the deal was completed, but industry sources questioned this assertion.

"RSA aren't buying an insurance company so they aren't buying any policies," said one, adding that RSA would have to price very keenly to secure renewals from's book.

Analysis by the Irish Independent showed RSA's pricing is significantly ahead of's on some lines.

RSA Ireland's market director Pat Nally yesterday declined to be drawn on whether would offer significantly

cheaper prices than RSA currently offers through brokers.

"We have a very strong growth ambition for," he said, stressing that RSA's business is "based on achieving profitable growth".

Mr Nally said that the deal would not mean any job losses at either or RSA.

A spokesman for Travelers declined to comment on the job implications of losing the business. Sources stressed, however, that Travelers also does substantial broker business in Ireland.

The deal marks a significant windfall for Dublin insurance broker Derek Richardson, who founded back in 2000 and now acts as chairman.

Companies' Office records show Mr Richardson, who lists an address in Monaco, owns about 65pc of, while managing director Mr Collins owns about 30pc. Collins was represented by Raglan Capital.

The remainder is split between a Santry-based Geoff Boyle, a Cyprus registered company called Applebear and the Gibraltar-domiciled 123 Money Ltd.

The acquisition marks RSA's fourth in four years. The insurer was also mooted as a potential buyer for Quinn Insurance.

Insurance sources suggested the purchase effectively ruled RSA out of the Quinn race, but Mr Nally declined to be drawn on that point.

Irish Independent

Also in Business