No 1 UK insurer Aviva is preparing to sell its underperforming RAC business when the market improves, according to reports.

Insurance Times says Aviva has been creating new management roles at RAC since December in order to turn it into a stand-alone business.

The former distribution director of Aviva UK Life, Angela Seymour-Jackson, has been appointed to the new position of RAC MD, with other Aviva executives filling the positions of sales and marketing director and CFO.

Aviva has declined to comment on the sale speculation, but in recent months CEO Andrew Moss has flagged his intention to focus on core businesses and dispose of non-core assets.

Aviva bought RAC in 2005 for £1.1 billion ($1.8 billion) and expected the firm to make pre-tax profits of £250 million ($408 million) by 2008. However it posted profits of just above £50 million ($82 million) in 2008 and 2009.

Business analyst Barrie Cornes said the RAC insurance operation “could be one of the businesses considered for disposal given the lack of natural fit with the rest of the UK business”.

The move is similar to Suncorp’s decision to sell its 50% stakes in insurance joint ventures with the Royal Automobile Association of SA (RAA) and the Royal Automobile Club of Queensland (RACQ) for about $350 million in July 2010.

At the time, Suncorp CEO and former Aviva executive Patrick Snowball said that while the joint ventures “have proven to be good investments for Suncorp, the next phase of our development requires a full-time focus on our core operations”.

Both joint ventures operated as stand-alone entities, with distribution through the RAA in SA and RACQ in Queensland.

In July 2008 Suncorp sold its 50% stake in the Royal Automobile Club of Western Australia Insurance, which it inherited as part of the Promina acquisition.