IAG announced today it has an in-principle agreement to acquire MotorServe, the motor vehicle repair specialist owned by NSW-based National Roads and Motorists’ Association (NRMA).

The financial details of the purchase, which is expected to be finalised at the end of January, have not been released as it would not have a material impact on IAG’s earnings.

IAG CEO Australia Mark Milliner expects the new addition to bolster the insurer’s motor offerings in the ultra-competitive personal lines market.

He says the decision to buy the business was made after a successful trial in Sydney recently at the MotorServe branch in Seven Hills.

“We’ve been exploring ways to deliver real change in how our customers experience the motor claims repair process, from the moment they lodge a claim to when they pick up their car,” Mr Milliner said.

“Our focus is on customer convenience and getting cars back on the road quickly with a quality repair.

“The NRMA MotorServe business fits in well with IAG’s strategy to provide a one-stop-shop for our customers and now includes mechanical repairs and car servicing as part of our enhanced motor repair model which we introduced earlier this year.

Mr Milliner says the acquisition will facilitate the “one-stop hub” model the insurer is keen to push in metropolitan areas.

“This will reduce the time currently spent on multiple trips to have a vehicle assessed, quoted and then repaired,” he said. “Depending on their policy, customers will be able to pick-up a hire car onsite to keep them mobile or will be provided a taxi voucher.”

NRMA Group CEO Rohan Lund has called the agreement a win-win for members of the mutual group as well as for IAG customers.

“By working together we can ensure better outcomes for people getting their cars serviced or repaired. MotorServe locations will help IAG grow in the automotive market and this is great news for customers and employees.”

MotorServe has 23 sites in NSW and the ACT providing a range of services including mechanical vehicle repairs, safety inspections and general servicing.