P&C insurer Chubb has entered a deal to buy the life and non-life insurance companies of Cigma in seven Asia Pacific markets for a total of $5.75bn.
According to Chubb, it will acquire Cigna’s $3bn premium revenue personal accident, supplemental health and life insurance business in Korea, Taiwan, New Zealand, Hong Kong, Indonesia and Thailand. The company also has its interest in a joint venture in Turkey. These operates previously generated around $3bn in net premiums written in 2020.
Chubb said the transaction advances its strategy to expand its presence in the Asia Pacific region – a long-term growth area for the company – and adds to an already sizeable accident and health business while expanding its Asia-based life insurance footprint.
Once the deal is completed, the share of Asia Pacific in Chubb’s portfolio will climb from around $4bn to $7bn in premium and represent approximately 20% of the firm.
Chubb has detailed that it expects a strong return-on-investment, with a three-year return-on-investment of 15%. The deal is expected to be completed in 2022 and is subject to regulatory approvals and customary closing conditions.
Chubb CEO and chairman Evan Greenberg said, “The addition of Cigna’s business, which is overwhelmingly A&H, will further balance our global portfolio toward this important region. We have long admired and respected Cigna’s business in Asia including its talented people, innovative products, technical and analytical capabilities, distribution and management. We know these businesses well as we already have a sizable operation of our own in the region and globally.
“These businesses produce very stable, high-quality earnings. The digital opportunity across the region is large and untapped and suitable for our direct-marketed A&H products and our consumer P&C and simple life insurance products. We are looking to the future. Broadly across the region, Chubb will be better able to capitalize on market and product opportunities with strong brand, complementary direct marketing skills and the cross-selling of Chubb’s non-life product to life customers.”
Cigna president and CEO David Cordani added, “Our agreement with Chubb is another step forward in advancing our strategic focus on our global health services portfolio. We are proud of our success in building these accident, supplemental and life benefits businesses in Asia Pacific and improving the well-being and sense of security of our customers throughout the region.”
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