Auto & General has entered into a 10-year contract to be the underwriter for Coles car, home and landlord insurance.

Chief growth officer Jonathan Kerr told insuranceNEWS.com.au the company will begin underwriting the products from next month.

“We have the ability to support Coles customers with very competitive pricing, additional options to tailor their insurance policies to meet their individual needs, as well as provide them with comprehensive service and claims support,” he said.

The supermarket chain’s products are currently underwritten by IAG, while Coles also sells pet cover issued by Guild Insurance. 

IAG CEO Nick Hawkins was asked at the insurer’s full-year earnings briefing yesterday about the impact on gross written premium from the company exiting the Coles arrangement.

“We found it pretty tough, that business, to make money out of, and so for various reasons we’re no longer part of that arrangement,” he said. The business represented only “a couple of hundred million” in premium within a company collecting about $16 billion, he said.

IAG inherited the Coles partnership when it bought the Wesfarmers insurance underwriting business in December 2013.

Aldi recently joined its supermarket rivals in offering insurance, announcing in June that it will sell home and landlord cover in Australia under a distribution agreement with Honey, underwritten by RACQ Insurance.

Woolworths provides home, landlord and car covers underwritten by Hollard, while pet insurance is provided by PetSure and travel is underwritten by Pacific International and administered by Nib.

From Insurance News magazine: Aldi takes its insurgency against Coles and Woolworths from the supermarket to the insurance market