Zurich, whose UK companies include Allied Dunbar and Eagle Star, employs around 1,100 essential car users and 2,200 'perk' drivers, managed by an in-house team of eight staff. Their future roles are under review.
A further 1,000 employees are entitled to a company car but have opted to take cash instead, in a separate scheme unaffected by the new arrangement.
The contract, which went live this month, means Alphabet will take responsibility for managing all the firm's current outright purchase fleet and funding them as they come up for renewal.
Zurich is scrapping its outright purchase policy in favour of a contract purchase arrangement for new cars. The Zurich contract will be handled by a dedicated team of technical staff at Alphabet (GB) headquarters at Hook in Hampshire.
Pete Steer, Zurich's HR services director, said: 'The move to Alphabet will provide a quality service to our people as well as contributing to some significant cost savings for our UK business.'