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The Hartford
As reported from sources by Reuters, Hartford Financial Services Group, Inc. is trying to sell its property/casualty insurance business, as it reels from massive losses. The Hartford has retained Goldman Sachs, which has been calling potential bidders for the property/ casualty business, the sources said.
Possible contenders for the business could include German insurer Allianz, which is already an investor, MetLife, Munich Re and Travelers. It was not clear whether any of these companies had been approached, however.
Hartford’s P/C business is worth about $8 billion on paper, based on the company’s statements filed with regulators, according to a February note issued by Citigroup analyst Joshua Shanker. But getting that price could be difficult, because capital and loan markets have been difficult to tap. An insurer such as Travelers, with a market capitalization of about $23 billion, could have trouble raising enough debt and equity to pay for a deal, a source said.
Allianz made a $2.5 billion investment in Hartford last October, giving it a stake, and the ability to raise its ownership in future. And Allianz could also be better situated to pay for the business, a source said. However, Sabia Schwarzer, a spokeswoman for Allianz of America, said the “investment in the Hartford is purely financial, not strategic.” She declined to comment further.
Goldman spokeswoman Andrea Rachman declined to comment, as did Travelers and MetLife. Hartford could not be reached and Munich Re spokeswoman Johanna Weber also declined to comment.
The development comes amid large losses for the 199-year-old company. Hartford, a large writer of a variable annuities, has been badly battered by investment losses and higher costs from guarantees on these annuities, which are linked to stock market performance.
It had a net loss of $2.75 billion in 2008, reversing a net profit of $2.95 billion the previous year. Earlier this month, media reports said Hartford was trying to sell parts of its life insurance unit to Canada’s Sun Life Financial Inc, but Bloomberg reported those talks ended without a deal. Hartford’s shares are down some 40 percent so far this year.
Starr Marine/Starr Indemnity
Starr Marine Agency, an indirectly wholly owned subsidiary of C. V. Starr & Co., and Starr Indemnity & Liability Co., an indirectly wholly owned subsidiary of Starr International Co., a private investment holding company, have announced an agreement, allowing Starr Marine to offer $100 million of commercial underwriting capacity to its clients effective July 1, 2009.
Woodlands
Texas-based The Woodlands Financial Group Inc. (TWFG), a retail and managing general agency, has opened branch locations in Florida and Maryland.
Maricela Scheller has opened a new branch in Boynton Beach, Fla. Most recently Scheller was the agency manager for Palm Beach Risk Management of Allstate.
Ryan Moorhart has opened a new branch in Cheverly, Md. Moorhart joins TWFG with three years as an agent with Allstate.
TWFG has 160 locations and 950 independent agencies across 17 states.
Hub/ABCO
Insurance broker Hub International Limited is selling some of its Florida wholesale and specialty insurance business back to a previous owner. Hub said it is selling Hub International Florida, including wholesaler ABCO Insurance Underwriters and ABCO Premium Finance, in addition to a specialized commercial lines book of business.
Hub is divesting what it terms as these primarily non-core revenues to Hector Fortun, the former owner of the Florida-based brokerage that was purchased by Hub in 2006.
Hub will retain its personal lines business based in Plantation, Florida and said it will continue to invest and grow in Florida as part of its strategy.
Martin P. Hughes, chief executive officer, said Hub will continue to work with Fortun and his team on cross-referrals.
City National Bank/Patton/Dickens & Clark
Charleston, West Virginia-based City National Bank and its insurance division, CityInsurance Professionals, have acquired two agencies: the Patton Insurance Agency in Nitro and the Dickens & Clark Insurance Agency in Teays Valley.
The Patton Insurance Agency, which specializes in personal lines insurance, actually affiliated with CityInsurance last December. Dickens & Clark, an all lines agency, joined on April 1.
City National Bank is a subsidiary of City Holding, a $2.6 billion bank holding company based in Charleston.