Zurich Insurance and Farmers Exchanges have closed on buying MetLife’s U.S. property/casualty business for $3.94 billion.
The business acquired includes 2.4 million MetLife Auto & Home policies, $3.6 billion of net written premiums (2019) and 3,500 employees, according to Zurich.
The deal provides the Farmers brand an opportunity to gain more of a national presence and strengthen its position a major personal lines carriers in the U.S.
Jeff Dailey, chief executive officer for Farmers Group, called the deal a “milestone” in his company’s nearly 100-year history. He said Farmers-branded products will now be available nationwide, “providing consumers from coast to coast with more choices and opportunities to engage with Farmers when shopping for auto and home coverage.”
“It is an acquisition that complements very well…what we see on the commercial side where the market is hardening,” Zurich Chief Executive Officer Mario Greco said last December in announcing the deal. Reuters was the first to report on Nov. 20 that Zurich was in talks to buy the MetLife business.
The Swiss insurer was to contribute $2.43 billion to the deal through its Farmers Group Inc (FGI) unit, while the Farmers Exchanges will contribute $1.51 billion, Zurich said.
MetLife President and CEO Michel Khalaf said the sale would allow the life insurer to focus on its “core strengths.”
The MetLife Auto & Home policies will remain the same other than being rebranding with the Farmers name, according to the company.
As part of the transaction, the Farmers Exchanges entered into a 10-year exclusive distribution agreement with MetLife to offer Farmers personal lines products on MetLife’s U.S. Group Benefits platform, which reaches 3,800 employers and approximately 37 million eligible employees.
Farmers Group was acquired by Zurich Financial Services in 1998.
The Farmers Exchanges are three reciprocal insurers (Farmers Insurance Exchange, Fire Insurance Exchange and Truck Insurance Exchange) owned by their policyholders, and together with their subsidiaries and affiliates comprise the Farmers Insurance Group of Companies. Farmers Group, Inc. and its subsidiaries provide administrative and management services to the Farmers Exchanges.
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