AIG Expanding at Lloyd’s With New Unit for U.S. High-Net Worth Market

By | October 28, 2019

American International Group Inc. is ramping up its bet on the wealthiest Americans with a new push to offer policies through the Lloyd’s of London marketplace and write as much as $1 billion in gross premiums.

AIG plans to create a Lloyd’s of London syndicate to cover risks in the U.S. high-net-worth market, according to a statement Wednesday from the companies. The business would start writing policies at the start of next year.

New York-based AIG is already familiar with the market for wealthy U.S. clients through its private client group. It gained a Lloyd’s of London operation, Talbot Underwriting Ltd., in 2018 with its acquisition of reinsurer Validus Holdings Ltd. Talbot will help with the new syndicate.

“AIG’s industry-recognized private client group and its differentiated distribution network are highly compatible with Lloyd’s blueprint for innovation and sustained growth,” Peter Zaffino, AIG’s global chief operating officer, who also leads the general insurance business, said in the statement.

Under Chief Executive Officer Brian Duperreault, AIG has been expanding in various markets. Meanwhile, Lloyd’s of London CEO John Neal has been seeking to overhaul the insurance marketplace, which traces its history back three centuries. Lloyd’s uses syndicates formed by one or more capital providers to write the actual insurance risk.

Lloyd’s announced plans earlier this year to cut the cost of insuring risk at the marketplace and said it expects to write its first business electronically next year. The AIG and Lloyd’s partnership benefited from at least one of the changes — a streamlined application and approval process.

AIG had owned a stake in a Lloyd’s of London insurer, Ascot Underwriting Holdings Ltd., before selling it in 2016.

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