Manchester-based Principal Insurance has acquired Europa Group, the Bristol-based broker best known for its long-established MotorCycle Direct brand, for an undisclosed sum. Specialist insurance broker Principal says the acquisition will place it among the top five intermediaries in the motorcycle market and provide a launch pad for further expansion in the sector.
Financed exclusively through shareholder funds, the deal includes MotorCycle Direct and Europa Underwriting, which trades under the Ridersure wholesale brand. It creates a broking group serving more than 120,000 policyholders and generating more than £60m in annual gross written premiums.
Commenting on the deal, Principal managing director Dave Bowcock said: “This acquisition not only makes impeccable commercial sense to Principal but also provides Europa with the opportunity to unlock shareholder value while joining a group with the scale and investment capacity to support its next phase of growth.
“Europa has a fantastic retail pedigree upon which, through investment and our product and technological expertise, we will further build.”
Bowcock added: “Our strengthened market presence will also enable us to deliver further value to UK motorcyclists, reaching deeper into the niches within what is a highly specialist sector. It’s safe to say, too, that this is a development which will invigorate a market that is in need of it. We are also very excited at the opportunities presented to develop our wholesale operations through Ridersure’s broker network, again adding value to our offer.”
Bowcock confirmed that Principal will retain Europa’s office in Bristol, with the group’s 77-strong workforce largely unaffected. Europa Group’s managing director Richard Waring added: “Having built the business through investment in technology and innovation, we decided the time was right to realise its value and pass it on into safe and trusted hands. As a tech-savvy and ambitious specialist broker, Principal is a perfect fit for Europa’s brands. No one better understands the market and how to secure sustainable growth through satisfaction of niche demands and service delivery.”
The Europa deal follows Principal’s purchase last November of Peart Performance Marque Limited’s renewal book and is the latest in an ongoing series of acquisitions. The company has confirmed it is actively looking to complement its organic growth through the purchase of both specialist brokers and books across its key personal and commercial lines.
Aside from motorcycles, these include motorhome and courier insurance, sectors in which the company expects to be a top-five player within the next 18 months. Bowcock concluded: “We’re acquisition-hungry and have the funds to fuel that appetite. If you’re looking to exit markets in which we’re active, talk to us.”
Wakam UK joins Principal party
Principal is also teaming up with major insurer Wakam UK to expand coverage options in the market. Manchester-based Principal has joined forces with Wakam – an international underwriter with £700m plus turnover, in a move which it says will “stimulate competition and extend availability of cover to bikers.”
Principal argues that major consolidation in the bike broking market and the scaling down or withdrawal from the sector by insurers in recent years have stifled competition. It says the new partnership aims to address this through “a significant injection of motorcycle underwriting capacity and by harnessing expertise to create bespoke policies which will better serve niches within the bike market.” Principal also says that this additional capacity will allow it to retail tens of thousands of specialist policies to better meet the needs of classic, modern and vintage bike owners, including sports bikers and scooterists.
“The bike insurance market has become stagnant, with competition throttled by various mergers and acquisitions and insurers either leaving or reducing their underwriting exposure,” said Principal Insurance’s head of distribution, Matt Byrne. “This agreement with Wakam not only brings significant capacity, but also the specialist broking and underwriting expertise necessary to identify and satisfy the needs of a broad range of bikers and their bikes.”
Mark Christer, CEO of Wakam UK, said: “The UK motorcycle insurance market has, over recent years, undergone significant consolidation, resulting in a small number of providers dominating distribution and pricing. For riders that has resulted in limited choice, rising premiums and difficulty securing appropriate cover, particularly for custom bikes and certain rider profiles.”
Principal Insurance
0330 024 0087
www.principalinsurance.co.uk