The Co-op Group has completed the sale of its underwriting business to Markerstudy, TwinFocus and funds managed by Blackstone Credit for £185m.
The deal includes a 13-year partnership agreement with Markerstudy, with ambitions to “significantly grow the Co-op’s insurance footprint”, with the goal of expanding its ability to offer home and motor insurance to more people across the UK.
In addition, Co-op Insurance says it will work with other insurance partners “to create compelling products and services in a Co-op way to meet its 4.6 million members’ needs”.
Co-op Group CEO Steve Murrells said: “We’re pleased to announce that the sale of our underwriting business has now successfully completed for proceeds of £185m.
“From the outset we have been clear of our intention to significantly grow our insurance footprint and the completion of this deal coincides with the start of a 13-year partnership for Co-op Insurance and Markerstudy Group, enabling us to now deliver upon our ambitious expansion plans, to meet more of our members’ insurance needs more of the time.”
Kevin Spencer, group CEO of Markerstudy, said: “We are delighted that this sale has completed and today we start our partnership with Co-op Insurance.
“With over 1.8 million customers currently, we have the expertise and the capability to continue to meet the existing needs of the Co-op’s members and customers for the long term and to help develop a wider range of products.”
The deal sparked controversy with protests in September after union leaders claimed the move would lead to 200 job losses and called for a rethink. In response, the Group insisted that staff “have been our utmost priority”.
The following month, Markerstudy’s underwriting director Gary Humphreys wrote in a blog for Insurance Age that the business had “minimised the impact on Co-op and Markerstudy Group staff by listening carefully to the options proposed to avoid compulsory redundancy”.
He claimed that “far fewer roles than initially anticipated were put at risk” with voluntary redundancy offered where possible.