Two leading U.S. property/casualty insurance carrier trade groups are talking about merging.
The American Insurance Association (AIA) and the Property Casualty Insurers Association of America (PCI) said their respective boards have approved moving ahead with merger talks and due diligence, although there is work to do before any final recommendation is put before member companies.
“Our goal would be to combine the best of both organizations into one preeminent thought leadership and advocacy voice for personal, commercial and specialty property casualty companies, while providing valuable information and compliance services,” the groups said in a joint statement today.
According to the lobbying groups, the merged association would speak for approximately 60 percent of the U.S. property casualty market.
PCI says it has 350 member company groups (or 1,000 member companies) that write $220 billion in annual premium, or 37 percent of the nation’s home, auto, and business insurance market. David A. Sampson has been president and CEO of PCI since 2007.
AIA’s 330 companies write more than $134 billion in premiums each year. John Degnan, former long-time Chubb official, is AIA’s president and CEO. Leigh Ann Pusey stepped down last June as president and CEO after leading the organization since 2009.
Both groups lobby in Washington and the states, offer research and publications, and host conferences for members.
If the merger happens it will leave only two national groups representing primary property/casualty insurers on the national stage and in state legislatures: the new merged group and the National Association of Mutual Insurance Companies (NAMIC). NAMIC represents more than 1,400-member companies that write $253 billion in annual premiums, or 40 percent of the market.
PCI was itself created in 2004 with the merger of two groups, the Alliance of American Insurers and the National Association of Independent Insurers.
Asked for a comment, Neil Alldredge, senior vice president of corporate affairs, said only that his organization “is aware of, and is following, the discussions between PCI and AIA.”
If the marriage happens, it will be the second recent joining of national P/C insurance trade organizations. Last July, members of the American Association of Managing General Agents (AAMGA) and the National Association of Professional Surplus Lines Offices (NAPSLO) approved a merger of the two associations, creating the new Wholesale & Specialty Insurance Association (WSIA).
Also, in March, the Financial Services Roundtable (FSR) and The Clearing House (TCH) announced plans to merge their association activities. FSR members include many of the same large banks that belong to TCH as well as insurance, asset management, finance and credit card companies.
AIA and PCI today issued a joint statement from their leadership — Anthony J. Kuczinski, Munich Reinsurance America and chair of the board of directors of the AIA, and Kurt F. Bock, CEO of COUNTRY Financial and chair of the board of directors of PCI. In it they said their boards have authorized merger discussions and due diligence because they “believe there is great benefit in a more unified policy and advocacy voice for property casualty insurers, given the unprecedented pace of change in the world and the resulting potential opportunities and challenges.”
The statement added that the boards have “agreed in principle that the governance structure of a new trade would have to reflect the broad diversity of the united membership and continue both organizations’ strong support for promoting and improving private competitive insurance market solutions and the U.S. state-based regulatory system through effective public policy engagement.”
Was this article valuable?
Here are more articles you may enjoy.