This will bring about the shift in employment of about 575 employees from one company to the next.
The RBC Insurance company in Canada has announced that it will be selling both its home and auto businesses to Aviva, in a massive move that will require some employees to move to the new insurer while others remain with the Royal Bank of Canada.
It has been estimated that 575 people will be swapping insurance companies while the remainder will stay put.
Initial reports have stated that RBC Insurance will be receiving approximately $582 million from this sale. According to a statement from RBC General Insurance, its own estimates are that it will be bringing in an after tax gain of about $200 million from the closure of this agreement with Aviva. It is expected that it will be completed at some point between July and September 2016. Beyond the purchase price of the acquisition, Aviva Canada also intends to begin providing a full property and casualty insurance suite to the RBC policyholders, including both auto and home coverage.
This is a part of the Aviva Canada 15 year strategic agreement that has been established with RBC Insurance.
At the moment, current policyholders are not affected by the acquisition that is occurring between Aviva and RBC. The 575 bank employees will start their move over to Aviva, while other workers who are part of the sales process support will be staying with RBC. The employees that will be making the move to the new insurance company are those who are responsible for underwriting, claims, information technology, product development and other related functions.
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According to Greg Somerville, the chief exec at Aviva Canada, in a statement released jointly by both insurance companies, “This partnership is a fantastic addition to Aviva Canada, diversifying our distribution alongside our highly-valued 1,500 independent brokers.”
In a statement from the head of RBC Insurance, it was explained that the bank chose to pursue this deal because it will provide the opportunity to place a greater focus on investing in areas with the largest growth potential, such as wealth, health and life insurance.