Royal & SunAlliance: UK Personal General Insurance Competitor Profile 2006

Table of Contents

• CHAPTER 1 INTRODUCTION
  • What is this report about?
  • Who is the target reader?
  • How to use this report
• CHAPTER 2 ROYAL & SUNALLIANCE
  • Royal & SunAlliance is part of the Royal & SunAlliance Group, and pursues a multi-channel distribution strategy in the UK
    • The Royal & SunAlliance Group writes general insurance business in a number of markets
    • R&SA writes business in the UK through brokers and affinities and its direct brand MORE TH>N
  • Household is R&SA' s largest personal line, but following reductions in this account, private motor is now almost as important to the insurer
    • Royal & SunAlliance writes both commercial and personal business, though commercial lines dominates the business
    • R&SA' s personal lines of household, private motor and accident and health have all seen negative compound annual growth rates over the last five years, but for some lines growth picked up in 2005
    • The insurer also writes individual accident and health business, administered by First Assist
    • R&SA' s household book decreased in 2004 following the termination of the HBOS account
    • R&SA' s private motor book declined in premium terms between 2002 and 2004, but achieved growth in 2005
    • Motor continued to grow in 2006, while household reduced further
    • R&SA' s profitability has improved since 2003
  • The aim to achieve profitable growth governs R&SA' s personal lines product strategies
    • In private motor, increased pricing sophistication will drive growth
      • Growth plans are closely linked to new price rating factors showing the insurer' s focus on profitability
      • Increased pricing sophistication also play a role in driving growth in the direct channel
      • Two new motor insurance initiatives were launched in 2006
    • A new partnership deal promises growth in the line of household insurance going forward
  • R&SA sells insurance via brokers, affinities and direct via MORE TH>N, and expects to grow in each of these channels over the next five years
    • In 2006, the insurer went through a restructuring process, organising the company around the three main distribution channels
    • R&SA sells insurance direct via the MORE TH>N brand
      • MORE TH>N advertises mainly motor insurance via television advertising, reflecting the fact that it sells insurance direct
    • The insurer also distributes via affinities, and has set strong growth aims in this distribution channel
    • R&SA plans to become number one in the broker channel
  • R&SA' s main focus is on achieving profitable growth, which is reflected in both its product and its distribution strategies
    • The insurer has a number of cost-reduction targets, aimed at securing its continued profitability
    • The focus on profitability also influences the insurer' s growth plans in personal lines, via the different distribution channels
• CHAPTER 3 APPENDIX
  • Methodology
    • Competitor data
      • GWP versus GEP reporting
      • Major changes in FSA Return categories and their impact
    • Market size
      • Changes in market size information
  • 2005 definitions for lines of business
    • Accident & health
    • Motor
      • Total private motor
      • Private motor comprehensive
      • Private motor non-comprehensive
      • Motorcycle
    • Property
      • Household and domestic all risks.
    • Financial/Pecuniary loss business
      • Total personal financial loss business
    • Total personal
    • Total commercial
  • Ratio analysis by competitor
  • Premium income measures
    • Earned premiums
    • Gross Premium
    • Net Premium
    • Written premiums
  • Current readings
  • Future readings
  • Do you need more information?
  • SPP writing team
  • List of Tables
    • Table 1: Royal & SunAlliance Group' s NWP by line by area, 2005
    • Table 2: Split between personal and commercial business for R&SA, 2005
    • Table 3: R&SA' s growth rates and share of personal GWP by line of business compared to the market, 2005
    • Table 4: R&SA' s personal lines premium income split by line of business, 2001-5
    • Table 5: Key statistics relating to R&SA' s personal lines book, 2001-5
    • Table 6: R&SA' s UK personal lines NWP by line of business, Q3 2005-Q3 2006
    • Table 7: MORE TH>N advertising data by line of business and medium, 2005
  • List of Figures
    • Figure 1: UK personal lines business made up 16 per cent of R&SA' s total NWP in 2005
    • Figure 2: R&SA restructured into three divisions in 2006
    • Figure 3: Personal lines accounted for over one third of R&SA' s book in 2005
    • Figure 4: R&SA has underperformed against the market in terms of growth in its household, motor and individual accident and health books between 2001 and 2005
    • Figure 5: The gap between R&SA' s household and motor books has narrowed since 2003
    • Figure 6: As of Q3 2006 private motor made up more than half of R&SA' s personal net written premiums
    • Figure 7: MORE TH>N advertise primarily motor insurance via television advertising
    • Figure 8: Royal & SunAlliance aims to build its business in all distribution channels