Intermediary facing financial services provider, Personal Touch Insurance, has sold a 9.99% share in its business to Aegon UK, one of the largest insurance groups in the world, in a bid to strengthen its financial base.
The move is expected to give the West Midlands-based firm the financial backing to consolidate its position in the market before the onset of statutory regulation in 2004. Personal Touch distributes a range of mortgage and general insurance products through its 10,500 strong intermediary channel, and has doubled its turnover each year for the past four years.
Mike Allison, strategic development director of Personal Touch, said: ‘The investment by Aegon will help us to build on our success to date and, most importantly, will give us the financial backing to continue our development at a time when this is becoming such a vital issue in today’s market.’
It is expected to use the influx of capital to develop its IT portal and technology infrastructure.
However, Rachel Maidment, spokeswoman for the General Insurance Standards Council, was not surprised: ‘This type of activity has been prominent for a number of years now. And in the run up to the statutory regulation of general insurance, because of the perceived costs that come with it, I think that more companies will have to put greater emphasis on moves like this to achieve greater economies of scale.’
This is not the first time Aegon has bought into this market in a bid to expand its own base. Late last year, it bought controlling stakes in two advisory firms, Advisory and Brokerage Services and Positive Solutions.