In recent news, Allianz Global Corporate & Specialty SE (‘AGCS’), a subsidiary of the Allianz Group that specializes in large corporate and specialty insurance, has announced an agreement to sell its U.S. MidCorp and Entertainment insurance businesses. These businesses were previously underwritten through its Fireman’s Fund subsidiaries. The buyer, Arch Insurance North America, which is part of Arch Capital Group Ltd. (‘Arch’), has agreed to pay $450 million in cash for the acquisition, reflecting the franchise value of the business. Additionally, Arch will assume approximately $2 billion of loss reserves associated with the business as part of the deal. The total transaction value for Allianz Group is estimated to be $1.4 billion, including the cash payment from Arch and approximately $1 billion in Allianz capital supporting the businesses being sold.
Moving forward, AGCS U.S. will focus on its Large Corporate and Specialty business, allowing it to concentrate on market segments where it has deep expertise in addressing clients’ most complex risks. U.S brokers and clients will continue to benefit from Allianz’s global and industry-specific capabilities across underwriting, claims, and risk consulting, including multinational insurance programs and alternative risk transfer solutions.
Tracy Ryan, AGCS Chief Executive Officer for North America and member of AGCS’s Board of Management commented on the transaction stating that this move allows the company to leverage its strengths in important market segments while ensuring continuity for partners who have served these businesses over the years. The employees who are transferring from AGCS to Arch are highly praised for their work and their addition to Arch is expected to be valuable in continuing to provide excellent service to clients and brokers alike.
The businesses being sold are underwritten by Fireman’s Fund Insurance Company and its subsidiaries with a total gross premium written in 2023 of $1
