RBS sells insurance unit
The Royal Bank of Canada (RBC) is to sell its home and auto insurance business, RBC General Insurance, to Aviva Canada for CAD 582m ($411m). Reports suggest that the deal will allow the bank to focus on areas with more potential for growth, such as life, health, and wealth insurance.

As part of the agreement, around 575 RBC Insurance employees currently involved in underwriting, claims and other related functions will become part of Aviva Canada's team.

The deal includes the acquisition of RBC's existing home and motor insurance business. In addition, the two firms will enter into a 15-year agreement which allows RBC Insurance to continue to sell products to its existing and future customers.

Aviva Canada will also provide policy administration, claims services and a full suite of property and casualty products to RBC Insurance customers.

Aviva claimed the transaction would diversify the firm's distribution route in addition to its broker channel, where it serves 1,500 independent partners.

Greg Somerville, Aviva Canada CEO said: "This is consistent with our strategy to provide consumers with choice about how they access insurance solutions. I am looking forward to welcoming the RBC Insurance employees joining Aviva."

RBC confirmed policyholders would not be affected and it would continue to provide insurance and claims settlement services for existing customers until the transaction closes.

Neil Skelding, president and CEO at RBC Insurance, said: "This partnership will allow us to maintain our deep client relationships, while offering a full suite of property and casualty insurance products."

Aviva believed the transaction would increase its Canadian business' annual gross written premiums by approximately 20%.

RBC Insurance has more than four million clients globally and employs more than 3,000 employees.

Mark Wilson, group CEO, said: "RBC has a formidable brand and loyal customer following while Aviva brings deep insurance expertise - all the makings of an excellent partnership."

The deal is expected to close in the third quarter of 2016, subject to customary and regulatory approvals.