Tesco finds new car insurance partner

Mon, 29 Jun 2009

Tesco has ditched the Royal Bank of Scotland as its car insurance partner in favour of the Belgian-Dutch financial services firm Fortis .

The £500 million deal will see Fortis help the supermarket giant develop the car insurance arm of its business, as well as other products such as home insurance.

Now agreed, the partnership awaits official confirmation, which if established could create as many as 1,500 jobs in the UK.

Under the terms of the deal, Fortis would underwrite Tesco's insurance products in the second half of 2009.

Fortis currently works alongside fellow high street food and clothing retailer Marks and Spencer, developing its financial products, and is set to embark on a similar project with John Lewis .

Tesco is reportedly keen to expand its financial operations in a bid to capitalise on the flagging reputations of high street banks, offering consumers a fresh alternative.

The firm also has plans to expand in the financial sector by launching current account products, which Bennie Higgins, chief executive of Tesco Finance, told the Sunday Herald would "be about … transparency".
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