RSA said the board had indicated to Zurich it was willing to recommend the offer "subject to satisfactory resolution of other terms".
RSA also said it had agreed to extend the deadline for Zurich to make a firm offer to Sept 22, in line with British takeover rules.
The 550 pence offer proposal reflects an 11 percent premium to RSA's closing price on Monday and a 26 percent premium to the share price before Zurich announced its bid interest.
"We expect RSA's shares to respond favourably this morning with a deal now seeming inevitable, in our view," Shore Capital analyst Eamonn Flanagan said in a note to clients.
"We await the possibility of a counter-bid from another continental European insurer," he added.
Sources familiar with RSA's thinking initially indicated the British insurer, which is in the early stages of a turnaround under former RBS chief Stephen Hester, was looking for an offer of at least 600 pence.
But Zurich's chief executive Martin Senn has said the firm did not want to overpay.
Zurich said in a separate statement it reserved the right to make an offer below 550 pence.