Press Releases
TESCO AND FORTIS FINALISE INSURANCE PARTNERSHIP
11 September
Personal Finance Plc (TPF) and Fortis (UK) Ltd (Fortis) have
concluded their previously
announced
*
discussions to form a new partnership providing motor and household
insurance.
The
partnership will give Tesco responsibility for retail pricing,
sales and marketing, customer service and new product development
providing greater control of the insurance products sold under the
Tesco brand. Fortis will use its considerable
expertise to provide underwriting and claims management.
Millions of UK
motorists and householders will benefit as Tesco introduces better
products, keener prices and the high levels of service they have
come to expect from Tesco.
More than 1500
new jobs will also be created in the UK as a result of the
deal.
The
partnership also includes the creation of a new entity to
underwrite and manage claims. Known as Tesco Insurance Limited the
new entity will be owned 49.9% by TPF and 50.1% by Fortis. It will
start writing business towards the end of next year.
Both parties intend
to invest capital to support the development and growth of Tesco
Insurance. The amount of capital invested will reflect both
parties’ respective equity proportions and may change as the
business develops. Initial equity investments are expected to be in
the region of £100m (EUR 115 million) each.
The
partnership, which will initially run until at least 2015, covers
certain TPF insurance products including car, van and household
insurance. This area of TPF’s business currently involves
over £500 million (EUR 573 million) in annualised Gross
Written Premium.
The deal will
add another 1.5 million motor and household customers to Fortis
UK’s existing customer base of around 7 million people.
The number of cars insured by Fortis will increase to around 2.7
million making it the second largest car insurer in the UK.**
Tesco
Insurance Limited will be managed independently from Fortis
UK’s other insurance businesses.
ENDS
For further
information:
Tesco
:
Media:
Jonathan Church 01992
644645
Angus
Maitland
0207 379
5151
Investor Relations: Mark
George
01992 644800
Fortis:
Media
UK: Paul Lynes 02380 313152
Vanessa
Neill 0207 251
3801
Media Brussels: +32 (0)2 228
8292
Media Utrecht: +31 (0)30 226
3261
Investor Relations: Brussels +31 (0) 30 226
6566
Notes for
Editors:
*Announced on Thursday
25th
June 2009. See original press release at
http://www.tescoplc.com/plc/media/pr/pr2009/2009-06-25a/ for
detail.
**
Based on EMB
analysis of FSA returns published in 2008
Tesco
Personal Finance:
TPF is
fully-owned by Tesco Plc. It is the UK's largest supermarket bank.
Since its launch in 1997, it has grown to have nearly six million
customer accounts across 28 financial products and services.
TPF offers
consumers a range of simple and affordable financial products and
services including: general insurance - motor, home, pet and
travel; credit cards and personal loans; personal savings; Tesco
Compare and a network of cash machines (ATMs). Products are sold
through multiple channels including in-store, by telephone and
online.
In addition to the 1500 jobs this joint venture will create Tesco
has already created more than 200 new jobs this year in its
Edinburgh HQ and on August
20th
announced a further 800 new jobs as a result of its decision to
open a new operations centre in Glasgow next year.
Fortis:
Fortis
(Insurance UK) is a leading provider of personal and commercial
lines insurance solutions in the UK. Fortis UK has two main
divisions, manufacturing both non-life and life products, which are
distributed through a range of channels including brokers, IFAs,
intermediaries, affinity partners and the Internet, as well as
various wholly or partially-owned companies (RIAS, Fortis Insurance
Solutions, Affinity Solutions Ltd, Text2Insure and InsureTECH
Systems).
Fortis
insures in excess of 6.9 million customers working with a range of
partners. It employs almost 3,000 people with a head office based
in Eastleigh and others in Belfast, Bournemouth, Gloucester,
Reigate, Haywards Heath, London, Redditch, and
Stoke-on-Trent.
Fortis Holding
(Fortis SA/NV and Fortis N.V.) consists of (1) a 75% ownership of
Fortis Insurance Belgium (2) Fortis Insurance International, (3) a
45% stake in Royal Park Investments - a structured credit portfolio
entity - and (4) financial assets and liabilities of various
financing vehicles. Fortis Insurance Belgium is overall market
leader and a leading player in the Employee Benefits market. The
international insurance activities (Fortis Insurance International)
are located in the UK, where Fortis is the third largest player in
the market for private car insurance, France, Hong Kong, Luxembourg
(Non-Life), Germany, Turkey, Russia, Ukraine and joint ventures in
Luxembourg (Life), Portugal, with Millenniumbcp Fortis being a
clear market leader, China, Malaysia, India and Thailand. Fortis
currently employs over 10,000 people.
