Zurich has announced that they will be acquiring the global personal travel insurance business of American International Group (AIG) for $600 million. The deal is expected to be finalized by the end of 2024 and may include an additional payment if specific targets are achieved post-sale.
Zurich has made travel insurance a top priority for them, and acquiring AIG’s Travel Guard business will expand their presence in the U.S. as part of Zurich’s travel insurance provider, Cover-More Group. This acquisition positions Zurich as a leader in the travel insurance industry across all regions.
The CEO of Zurich Global Ventures, Cara Morton, described the transaction as a strategic fit that enhances Zurich’s existing capabilities and solidifies their position as a top travel insurance provider. By integrating AIG’s global IT platform and service centers, Cover-More’s capabilities will be significantly enhanced.
AIG’s CEO, Peter Zaffino, stated that the sale is a crucial step in positioning AIG for the future and ensuring a smooth transition for employees, customers, and distribution partners. The deal excludes travel coverages offered through AIG’s A&H business.
The acquisition is expected to result in annual gross written premiums of around $2 billion for the new Cover-More Group. Analysts at Bank of America believe that Zurich’s acquisition is a sensible move that could potentially increase earnings per share by 1-2% after integration.
Zurich has been looking to expand its presence in the U.S., and this acquisition allows them to do just that while also becoming a leader in the travel insurance industry globally. With Cover-More Group now being able to leverage AIG’s global IT platform and service centers, they will be able to offer even better services to their clients.
This acquisition also shows how important it is for companies to diversify their portfolios and invest in areas that align with their core values and goals. In this case, Zurich saw an opportunity to strengthen its position in the travel insurance industry by acquiring one of its biggest competitors’ businesses.
Overall, this transaction is expected to have significant benefits for both companies involved, including increased revenue, improved operational efficiency, and enhanced market leadership positions.
