News in numbers
Verdict InsurTech gathers the most important industry news in recent times, including some startling figures
US-based insurance major Allstate has agreed to divest Allstate Life Insurance Company (ALIC) to entities managed by private equity giant Blackstone for $2.8bn.
The transaction includes ALIC and certain subsidiaries, excluding Allstate Life Insurance Company of New York (ALNY).
ALIC holds around 80% ($23 bn) of Allstate’s life and annuity reserves. The unit generated a net income of $467m in 2019 and incurred a $23m net loss in the first nine months of the last year.
Concurrent with the acquisition, Blackstone will enter into an asset management agreement for ALIC’s $28bn of investments.
The deal is expected to close in the second half of this year, subject to regulatory approval.
UK insurer Aviva is planning to shutter some of its offices across the UK, allowing its employees to continue working from home even beyond the Covid-19 crisis.
The move will not lead to layoffs. Aviva expects that most of its staff will work from an office once a week, on a rotation basis.
Aviva as quoted by Personnel Today, said: “The way we use our office space is changing significantly. We are combining office space in some locations and reducing the space in others.
“Our intention is to invest in our sites to provide a more vibrant, inspiring and flexible workspace for our people.”
Aviva has offices across Birmingham, Bristol, Eastleigh, Edinburgh, Glasgow, Leatherhead, Leeds, London, Manchester, Norwich, Perth, Sheffield, Worthing and York, where more than 2,000 people are employed.
In York, it has two offices, of which, it will close one office. Similarly, in Norwich, it will shutter two offices. The consolidation is expected to take place by this March end.
UK-based insurance broker Howden has partnered with Australian insurance intermediary network Steadfast to launch broking operations in Australia.
The new development builds on the insurer’s 20-year partnership with Steadfast.
As part of this strategic partnership, the insurer will offer support to Steadfast’s London Market broking requirements.
Additionally, Steadfast will offer its network to Howden’s brokerage in Australia to bolster its access and reach.
Howden Australia will be led by Andre Louw as chairman and Igor Fijan as CFO.
Louw was previously chairman of Marsh for the Pacific region and JLT for Australasia. Fijan is former head of Integration of Marsh for the Pacific region and CFO of JLT, Australasia.
New Jersey-based specialty Insurer ProSight Global is set to be acquired by investment management firm TowerBrook Capital Partners and private equity firm Further Global Capital Management in a deal valued at $586m.
According to the agreement, TowerBrook will obtain a majority stake in ProSight, while Further Global will serve as a key minority co-investor.
As part of the agreement, stockholders of ProSight will receive $12.85 for each share of common stock.
The merger agreement was recommended by a special committee of the ProSight Board of Directors and was approved by ProSight’s full board.
The transaction, subject to customary closing conditions, is expected to close in the third quarter of this year.
US-based investment firm Sixth Street Partners has signed a definitive agreement to acquire Talcott Resolution Life Insurance Company for $2bn.
Sixth Street will acquire the company from a consortium of investors, consisting of Cornell Capital, Atlas Merchant Capital, TRB Advisors, Global Atlantic Financial Group, Pine Brook, J. Safra Group, and The Hartford.
Talcott Resolution provides a range of execution-focused capabilities, technology and analytics, and in-force and new business solutions that offer capital flexibility and risk management efficiencies to the insurance industry.
It manages more than $90bn in liabilities and surplus for its nearly 900,000 customers, which includes around 600,000 annuity contract holders.
Previously owned by The Hartford, Talcott was sold to the consortium in 2018 for $2.75bn.
The acquisition by Sixth Street is said to underline the company’s growth potential as a consolidation platform for the life and annuity market in the US.
Chubb forges insurance partnership with digital banking firm Revolut
Property and casualty insurer Chubb has entered into an insurance partnership with financial technology company Revolut that offers digital banking services.
Under the tie-up, the insurer will provide a range of coverage for customers of Revolut, including purchase protection, refund protection and ticket cancellation, when Revolut account is used for such transactions.
The policy also offers coverage when a customer is diagnosed with Covid-19 and is therefore unable to use event tickets booked through their Revolut account.
By Bits launches to transform the motor insurance industry
Insurtech By Bits has launched with a promise to transform the customer experience and bring fair pricing and motor insurance to drivers.
The platform allowed motor insurance providers to create personalised services for customers and bring usage-based policies to market in a fast and cost-effective way. As a result, insurers can meet consumer demand for pay-by-mile products.
By Bits has been launched by the co-founder of BY Miles, the UK-based pay-by-mile insurance product.
N26, Allianz expand insurance coverage to include pandemic related claims
Digital bank N26 has extended its Allianz Assistance travel insurance included with N26 You, N26 Business You, N26 Metal and N26 Business Metal to cover epidemic and pandemic related claims.
The move will offer customers cover against trip interruptions if traveling when necessary during the Covid-19 pandemic, with no extra charges.
N26 said that the extension of the travel insurance follows its efforts to accelerate to market to help customers bank and live more confidently during the Covid-19 pandemic.
Trips starting on 19 January or later booked with an N26 You, N26 Business You, N26 Metal or N26 Business Metal card will eligible for the expanded coverage.
It includes coverage for trips canceled or shortened due to an injury or any medical condition or diagnosis of any pandemic diseases, such as Covid-19, to account holder or their traveling companion.
Additionally, customers will be able to claim compensation for trips that are interrupted or cancelled because they or their companion was denied boarding due to exposure to any contagious disease.
They will be also offered emergency hospitalisation or medical treatment if they develop an illness, injury or medical condition during a trip abroad. They will be also able to claim medicine costs, medical transportation, and repatriation assistance, if applicable.
Zurich rolls out Workers’ comp payroll option for construction firms
Zurich North America has introduced a flexible payroll reporting option for construction companies covered under its Workers’ Compensation programme.
This new option is designed to help construction customers manage their cash flow and the uncertainty related to annual workers’ compensation premiums.
The Zurich Workers’ Compensation Flexible Payroll Reporting Option has been developed in collaboration with SmartPay, which provides pay-as-you-go workers’ compensation solutions.
The monthly payroll reporting option offers features such as real-time premium calculations based on payroll reports, automatic premium withdrawal via Automated Clearing House (ACH) and 12-month period payments time.
Additionally, the companies which select automated payroll reporting will not be required to pay down payment. 10% cash collateral is required of non-automated reporters.
This solution is said to minimise Workers’ Compensation audit exposure while streamlining the audit process upon policy expiration or cancellation.
Construction companies interested in enrol for the option should talk with their broker about it when the time comes to purchase or renew their Workers’ Compensation policy, said the company.
Parametric insurtech platform Arbol raises funds to expand footprint
Parametric insurtech platform Arbol has raised around $7m in its Series A fundraising round, increasing its valuation from the initial seed round.
The round was participated by the company’s all existing investors, including Finch Finance and Space Capital, in addition to a new investor, Mubadala Capital-Ventures.
Founded in 2018, Arbol provides parametric products that provide coverage against external risks including unexpected weather.
The company plans to use the new capital to expand the footprint of its platform.
During the first eight months of live transactions, the platform is said to have facilitated hundreds of deals for institutional clients, representing over $15m in notional risk.