RSA Insurance Group has appointed PwC to undertake a comprehensive review of problems in the claims and finance functions at its Irish business which saw the suspension last Friday of three members of its management team in Ireland, including the CFO, amid concerns there could be a £70m write-down as a result.

The company said the issues, which have not been specified, were identified during a routine internal audit. As a result, RSA Insurance Ireland has suspended its CEO Philip Smith, CFO Rory O'Connor and claims director Peter Burke.

According to Reuters, RSA Group chief financial officer Richard Houghton said the company is examining 'the booking of large losses within claims and the timing of the recognition of earned premiums,' dating back at least two years.

PwC's review will focus on the financial and regulatory reporting processes and controls within the Irish business, and the group oversight and controls of the Irish business during the relevant period, RSA said in a statement to the London Stock Exchange today.

The review will also assess the adequacy of the remedial actions being taken. PwC will report back to the RSA board before the end of the year.

Simon Lee, group chief executive of RSA said: 'We are extremely disappointed with the issues which have been identified and their financial impact on the group. Whilst the investigation is ongoing, I am confident that these issues are isolated to the Irish business. No policyholders have been affected and all our Irish businesses continue to operate as normal. Nevertheless, we want to ensure that the actions being taken in Ireland and across the group are correct and that all lessons are learnt.'

Lee said the issues are 'serious' but would not have a 'material, long term impact', although it estimates its 2013 operating result will be £70m lower than current market expectations.

RSA said it has injected capital into RSA Insurance Ireland to ensure its solvency ratio is 'comfortably' in excess of 200%. The group had already identified a need to increase reserves in the light of rising bodily injury claim trends and additional claims as a result of the St Jude storm. Shares in the company fell 13% to a 17 month low on news of the problems with its Irish business.

KPMG is to replace Deloitte for RSA's audit, after the insurer put its external audit contract - worth £15.7m in 2012 - out to tender in 2013.