Bermuda’s XL Capital Ltd. announced that its surety bond unit, XL Specialty Insurance Co., has agreed to purchase CGU’s U.S. surety business of for an undisclosed amount.
XLSIC President Daryl LaForge stated that the combination “represents a good strategic fit.” XLSIC writes primarily customs bonds and surety bonds for small and medium sized contractors, while CGU Surety specializes in “large contract and commercial surety risks.”
“We expect that the existing organizational structures, coupled with a historical focus on different segments of the surety market, will allow us to quickly integrate these two operations while expanding our service capabilities,” said LaForge.
The transaction is a further step CGU’s planned withdrawal from the U.S. p/c market, following its merger with Norwich Union and the sale of its general U.S. insurance business to White Mountains Insurance Group last September.
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