LONDON:
Britain’s Legal & General Group will sell its general insurance business to a UK subsidiary of Germany’s Allianz for 242 million pounds, the companies said on Friday.Allianz is also acquiring the remaining 51 percent of Liverpool Victoria Friendly Society's (LV='s) general insurance business that it does not already own, for up to £578 million.
Earlier in August 2017, Allianz purchased 49 percent stake in LV GIG in a deal that valued LV=’s general insurance at more than £1 billion.
Once the transaction has been completed, Allianz intends to combine the Legal & General general insurance business with LV GIG.
“With these two transactions, we are pleased to demonstrate our further commitment to the UK market," said Niran Peiris, member of the board of management of Allianz SE.
By taking full owndership of Legal & General Insurance , Allianz would become the second largest general insurer in the UK.
“We are pleased to announce the purchase of the Legal & General general insurance business which supports our commitment to establish Allianz as a leader in the personal lines market in the UK. The Allianz business is robustly capitalised, has a strong reputation for its focus on customer service and is committed to delivering the advantages of technology for the benefit of the customer,” said Jon Dye, chief executive officer of Allianz Insurance.
Dye added: “Our joint venture has been a great success and taking 100 percent ownership of LV GIG creates the best platform for taking the business forward. We have experienced the value and the culture that exists within LV GIG and we will continue to protect the integrity of these important assets.”
As part of the agreement with L&G, the Legal & General brand will continue to be used in the UK general insurance market for up to three years.
Steve Treloar, chief executive officer of LV GIG said: “Over the last few years, we’ve successfully grown our business to become a major household name and the addition of Legal & General’s general insurance business further strengthens our position. Once the business transfers to LV GIG we’ll have over 7 million personal lines customers, a gross written premium of over £2 billion and be a major player in the UK personal lines market.”
Legal & General will use the funds to reinvest in its core businesses, it said, and will complete the deal in the second half of 2019. The portfolio being sold comprises mainly retail customers who hold household insurance policies.