Virgin Direct, the telephone-based financial company owned by Richard Branson, is severing its links with Norwich Union barely nine months after they set up the joint venture.
Norwich Union is to launch its own direct selling operation in January, while Virgin has formed a new partnership with AMP, the Australian insurance group which owns Pearl Assurance. Both Norwich and Virgin claimed yesterday that they were still on excellent terms despite the split.
Norwich Union will continue to manage existing Virgin products, while AMP will inject pounds 50m into Virgin's phone-selling operation.
Mr Branson said: "We believe customers around the world are crying out for the potent mix of accessible products and rock bottom charges we have perfected over the past year. Collaborating with AMP will mean we can replicate our success on a world-wide basis."
Norwich Union Direct will initially sell motor and household insurance, then move into unit trusts and PEPs.
Analysts were unclear yesterday why Norwich and Virgin should have cut their ties so soon. Alan Richards, life assurance analyst at James Capel, said: "It may be that Virgin had big ambitions and Norwich Union was not prepared to fund them. Maybe Norwich Union wanted to learn something about brand marketing from Virgin."
Virgin plans to expand its product range to include more investment funds, portable pensions and term assurance.Reuse content