Aviva acquires RBC's home and motor insurance arm

Insurer Aviva's Canadian arm has agreed to acquire the home and motor insurance business of RBC Insurance for £281m.

The deal, which is expected to enhance Aviva's operating earnings and increase Aviva Canada's gross written premiums by 20%, includes an agreement to continue exclusively supplying products to RBC Insurance customers.

Part of Royal Bank of Canada, RBC General Insurance Co, generated gross written premiums of £2.2bn in 2014.

"This new partnership extends Aviva's presence in general insurance, brings additional diversification benefits to the group and presents excellent opportunities for revenue and earnings growth in the attractive Canadian market," said Aviva's group chief executive Mark Wilson.

"RBC has a formidable brand and loyal customer following whilst Aviva brings deep insurance expertise - all the makings of an excellent partnership."

Canada was already Aviva's second largest business, contributing £132m of operating profit in the first half of the year.