Business Moves

IAG, Lloyd’s

Insurance Australia Group Ltd. acquired a newly-formed Lloyd’s managing agency and specialist Asian syndicate, Alba Group Pte Ltd., to “support the development and management of its expanding Asian business.”

CEO Michael Hawker commented: “Acquiring Alba puts us in a strong position to leverage the reinsurance opportunities presented as we continue to execute our strategy to build a portfolio of Asian assets, as well as managing the risks inherent in these. In addition, the syndicate would enable IAG to add value through providing reinsurance support to its new Asian subsidiaries and partners.” Key personnel in the underwriting team will be based in Singapore.

IAG said it would “provide the majority of the capital to support the syndicate, in conjunction with Whittington Group, the underwriters and the management team. While the terms of the acquisition are confidential, the businesses have been newly established, and neither the purchase price nor the capital required in the first two years is material to the Group.”

Lloyd’s President, Asia-Pacific, Tony Egerton indicated: “The Lloyd’s Asia platform is becoming increasingly significant to the regional specialist insurance market.”

IAG is acquiring ALBA from Whittington Group Pte Ltd., an international insurance investment and service business headquartered in Singapore “with,” said the announcement, “a long history in Lloyd’s of London and international insurance markets. It is dedicated to providing bespoke and innovative outsource, investment and exit solutions to the insurance industry.”

Terms of the acquisition are subject to final regulatory approval from the Singaporean MAS and the UK FSA, the prudential regulatory authorities for this business.

Arthur J. Gallagher & Co., Lemac & Associates

Arthur J. Gallagher & Co.’s subsidiary, Risk Placement Services Inc., acquired Lemac & Associates Inc., headquartered in Los Angeles. Terms of the transaction were not disclosed.

Lemac & Associates is a wholesale insurance broker and managing general agent that provides excess and surplus property/casualty coverages including professional and general liability, workers’ compensation and other specialty insurance products and services throughout the United States. William Newton, president of Lemac, and his associates will continue to operate out of their current locations in Los Angeles and Orange, Calif., under the direction of Joel Cavaness, president of Risk Placement Services Inc.

Hull & Co., Excess & Surplus Lines Insurance Brokers

Hull & Co. Inc. acquired the assets of Excess and Surplus Lines Insurance Brokers Inc., located in Sherman Oaks, Calif., with revenue of approximately $2 million.

“This is a great acquisition for us as it gives us, after almost 40 years in California, an important physical presence in Los Angeles County from which to introduce our products and service to that critical market,” said Robert L. McGrew, senior vice president-branch operations for Hull & Co.

Jerome C. Boyer, president of ESLIB, and his staff will continue to operate from their Sherman Oaks location and will immediately adopt the Hull name. Boyer will report directly to McGrew. Hull & Co. is a wholly-owned subsidiary of Brown & Brown Inc.

GoodWorks, Hilb Rogal & Hobbs

GoodWorks Insurance, based in North Canaan, Conn., is extending its charitable philosophy to national accounts with the help of a joint risk management agreement with large insurance broker Hilb Rogal & Hobbs, Connecticut, a subsidiary of Hilb Rogal & Hobbs Co. (HRH).

GoodWorks Insurance entered into the arrangement with HRH through its newly launched affiliate GoodWorks National Accounts LLC. Working with HRH, the organization provides insurance to large national and specialty insurance risks in the commercial property and casualty market.

GoodWorks National Accounts embraces the same philosophy of GoodWorks Insurance by making a commitment to donate 50 percent of its annual operating profits to local community charities.

The agreement calls for HRH to utilize its network to help GoodWorks clients manage their risks in property and casualty, employee benefits, professional liability, and other areas of specialized exposure.

Hartford, Equitas

The Hartford Financial Services Group entered into an agreement with Equitas, the Lloyd’s runoff vehicle, and all Lloyd’s syndicates reinsured by Equitas that “resolves, with minor exception, all of the company’s ceded and assumed domestic reinsurance exposures with Equitas, including the company’s reinsurance recoveries from Equitas under the company’s Blanket Casualty Treaty,” said a company bulletin. Precise terms of the settlement agreement were not disclosed.

“This agreement is a significant step in our efforts to remove volatility from our ceded and assumed reinsurance portfolio,” indicated Neal S. Wolin, The Hartford’s executive vice president and general counsel. “The settlement eliminates uncertainty from our domestic assumed reinsurance book with Equitas. It also resolves our single largest reinsurance recoverable, bringing years of litigation with Equitas to a close.”

The Hartford explained that the “Blanket Casualty Treaty, which was the focus of the litigation, is a multi-layered reinsurance program that provided for excess-of-loss coverage for The Hartford in various amounts from the 1930s through 1980s. The upper layers of the treaty were first put in place in 1950, primarily with London Market reinsurers, including Lloyd’s syndicates. The Blanket Casualty Treaty litigation continues with the other upper-layer reinsurers under the treaty.”

In addition The Hartford announced it had “completed three comprehensive reserve reviews on business reported in the Property and Casualty Other Operations segment. The company reviewed all reinsurance recoverables and the allowance for uncollectible reinsurance.

“Second, the annual, ground-up asbestos review resulted in no addition to the company’s asbestos reserves. Finally, the company also completed its review of reserves related to HartRe’s assumed reinsurance business, which is in runoff. This study resulted in no material impact to the company’s earnings.”

Topics Lloyd's