Royal Bank of Scotland has announced it is buying Churchill Insurance in a £1.1 billion deal.
Royal Bank, which already owns insurance firm Direct Line and Ulster bank, says the deal with Churchill's current owner Credit Suisse will make it the third largest general insurer in Britain.
Churchill which employs 8,500 people across Britain and has seven million policies in force, made pre-tax profits of £86 million on premium income of £1.6 billion last year.
Mr Fred Goodwin, chief executive Royal Bank of Scotland, said: "Churchill is an excellent acquisition for us, it will fit well alongside Direct Line, and will bring several advantages to the group.
"In direct channels, Churchill's strength in home insurance will balance Direct Line's strong position in motor insurance.
"Both Churchill and Direct Line have expertise in the distribution of general insurance products through partners, under their brands."
PA