Direct Line to Acquire RSA’s Italian Auto Business

U.K. auto insurer Direct Line, a subsidiary of the Royal Bank of Scotland, has agreed to acquire the Italian auto insurance operations of Royal & Sun Alliance for £12 million ($17 million).

Direct Line, which takes its name from its initial concept of providing auto coverage through telephone contact, is the U.K.’s largest auto insurer with some 3.1 million policyholders. It has already acquired a foothold in the estimated $16.8 billion Italian auto market with the acquisition last September of Allstate’s European auto insurance operations.

It becomes Italy’s second largest direct writer with some 300,000 policyholders, and plans to aggressively market its products. It’s already had success with its business model in Spain, where its Linea Directa subsidiary is the country’s largest direct insurer, and it’s seeking similar growth in Germany.

RSA will retain its general insurance business operations in Italy, and has indicated that the sale was in line with its strategy of concentrating on operations in the U.K., North America, Scandinavia and Australia.