The latest from the insurance sector see the withdrawal of French insurance giant AxA. It made a deal of £295m by selling its insurance brokerage Bluefin to rival firm Marsh. The company took this harsh decision as it was struggling to manage sustained profits for a decade.
AxA plans expansion in faster growing regions and hence it withdrew from Britain and Europe. The firm is still offering car and personal insurance in the UK however has pulled back from the realm of life insurance. It made a series of deals to sell its life insurance business to Phoenix and Standard Life.
Talking about Bluefin, it recorded a turnover of £122m in 2015 which was due to the sale of personal and business insurance from its providers located throughout the UK. It also got the benefit of a pre-tax profit which was equal to £1.2m. But, last year’s gain was much lower when compared to the £7.2m loss, which the company incurred in 2014.
Due to these losses, the company sold Bluefin’s financial planning business in 2013 and is now selling its life insurance wing as well. The French insurance giant said that the sales deal will complete by Q1 of 2017 and would hamper its profits by an amount equal to £56m. The buyer firm Marsh has expressed that it was keen on buying Bluefin for several years and has finally achieved its goal.
Its chief executive for UK and Ireland, Mark Weil said that “It goes back quite a while in terms of our interest, and AxA has got to the point where they are ready to make a decision. From Marsh’s point of view, this is a long-term play”.
Bluefin was created by AxA in 2006 but could not deliver the profits as expected from it. Amanda Blanc, chief executive of AxA in UK and Ireland expressed her view of finding better markets by saying that “As market dynamics have evolved and our own strategy has progressed, it has become increasingly apparent that Bluefin’s ability to achieve its potential would be better served under a new parent”.
From a third party’s perspective, it is interesting to note that post Brexit insurance giants like AxA are moving away from the UK territory in search of better opportunities outside the EU and Britain. If more insurers choose to opt the way AxA did then the insurance sector would face damaging consequences in the long run and it may not be good for the UK insurance market.
If you would like to know more of such business news and the latest happenings then, check our website Freepricecompare.com. You can also read our comprehensive guides on all kinds of insurances including motor insurance, life insurance, home insurance and more. Our friendly team of insurance experts can also be contacted by giving a quick call on 02034757476.
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