Rumours suggest RSA will agree to sell its UK personal lines business to another leading insurer within the next few weeks. The insurer’s strong presence in household and pet insurance sectors makes this a significant move for the industry. Reuters reports that the insurer has instructed JPMorgan to find suitors to submit offers, although nothing has been confirmed by either party. RSA has already exited the UK personal motor insurance space in 2023; this new development seems to confirm the firm’s shift in focus towards commercial lines going forward.

GlobalData’s UK Top 20 General Insurance Competitor Analytics notes that RSA was the second-largest insurer in the household insurance market in 2021. It held a market share of 9.9%, which equated to £622m. Only Aviva accounted for more premiums in 2021 (£766.5m). Indeed, Aviva is one insurer that has been linked to a potential purchase of RSA’s personal lines business. Doing so would make Aviva the dominant player in the household market; its combined market share would have been 22.1% as per 2021 data. However, such a move may be blocked by the Competition and Markets Authority, as the new combined firm would be by far the largest player in the market. By 2021 data, Lloyds Banking Group would have been the second-largest provider with a much smaller share of 9.3%. Such an outcome could significantly hamper consumer choice in this segment.

RSA is also a strong player within the pet insurance market. It underwrites for brands such as Tesco Bank, John Lewis, M&S Bank, as well as its own personal lines brand More Than. In terms of underwriters by premiums, it was the second-largest player in the market with a share of 12.1% in 2022. Similarly, GlobalData’s 2022 UK Insurance Consumer Survey found that More Than, John Lewis, Tesco Bank, and M&S Bank had a combined market share of 10.7% for dog insurance in terms of contracts, behind only behind Petplan and Animal Friends. There have been a string of mergers, takeovers, and withdrawals recently in the UK insurance market. This includes Aviva buying AIG Life and Vitality and RSA exiting personal motor insurance in 2023. A full RSA exit from personal lines would be more significant, as it is among the market leaders in both pet and household insurance. This would therefore represent a significant shake-up of the personal lines market and could see another insurer, such as Aviva, become dominant within this space.

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