Ageas to buy Saga's underwriting business as part of 20-year partnership

(Sharecast News) - Saga said on Monday that it has entered into an agreement with Ageas to establish a 20-year partnership for motor and home insurance which includes the acquisition of its underwriting business. As part of the Affinity Partnership, Ageas will take on price-comparison website distribution, pricing and underwriting, claims and customer servicing activities, with Saga retaining responsibility for brand and direct marketing.

Saga will receive an upfront payment of £80m and contingent considerations of up to £30m in 2026, and the same again in 2032, subject to certain policy volume and profitability targets being met and the satisfaction of certain conditions.

Ageas will pay £67.5m for Saga's underwriting business, Acromas Insurance Company Limited (AICL).

Saga chief executive Mike Hazell said: "Today's announcement represents an exciting next step for Saga Insurance. This is a complementary partnership which leverages the strength of the Saga brand and customer base, along with Ageas's extensive and growing UK insurance expertise.

"Together, we represent a winning combination. Our joint scale and unrivalled knowledge of the over 50s insurance market represents a strong platform from which we can serve even more customers with relevant, innovative and intuitive products.

"For Saga more broadly, this agreement is in-line with our stated partnership strategy. It demonstrates clear progress as we move to pay down debt and target long-term sustainable growth - for the benefit of all our stakeholders."

Saga and Ageas announced in October that they were in exclusive talks about setting up a 20-year motor and home insurance broking partnership.