Sainsbury’s are set to relaunch their car insurance business tomorrow, as they get set to begin a major car insurance price war with Tesco.
Sainsbury’s, who will team up with RBS insurance to offer the deal will give customers savings of nearly 15% on premiums in the form of Nectar loyalty points.
Shoppers are also bale to earn Nectar loyalty points which will be worth one per cent of their bills for the next to years.
Sainsbury’s hope to appeal to a market that has seen car insurance prices increase by around 30% in the last year, with the average premium now costing around £815.
Tesco have already made inroads with their competitive pricing and club card points deals, with nearly 5% of all British motorists now insured through the supermarket and Sainsbury’s will be hoping to make similar inroads.
Tesco and Sainsbury’s hope to use their powerful brand names to gain business from the already tarnished banks, and Sainsbury’s will end their association with esure to offer their products through RBS instead.
Head of motor insurance at esure, Ben Tyte explained that the company were planning to expand, and “make a significant impact on the market”.
Tyte continued by adding that using the Nectar card to offer rewards was designed to increase customer loyalty to the product.
Sainsbury’s insurance arm reported pre-tax profits of £30million in the last quarter, increasing new business by around 25%.