The Hartford’s $2.1bn deal to acquire specialty player Navigators would significantly expand the Connecticut-based personal and commercial lines giant’s geographic footprint beyond its US heartland.
In a presentation explaining the deal, The Hartford said the deal “expands geographic underwriting reach to support industry verticals and The Hartford’s US customers’ risk management needs”.
Navigators would add claims and underwriting offices in nine different locations, The Hartford said. Not only that but the firm’s Lloyd’s Syndicate 1221 gives the firm access to the Chinese market.
It said the deal would add a global reinsurance operation that includes US accident and health business, as well as international property.
“The Hartford expects to continue Navigators’ reinsurance strategy, gaining efficient access to global risks in product lines with profitable growth potential,” the insurer said.
And that, it said, offers an opportunity to grow its customer base in international markets by “leveraging Navigators’ growing underwriting operations in Europe, Asia and Latin America”.
Further, the deal would see The Hartford’s commercial lines unit grow to account for roughly half of the combined group’s consolidated net premiums, which it said could grow to $17bn after an acquisition.
Navigators would account for about $1.3bn of The Hartford’s $8.2bn commercial book. The Hartford’s personal lines book is worth $3.6bn while its group benefits division writes $5.2bn.
The Hartford said that the addition of Navigators would bring together “two underwriting-centric organizations with a commitment to innovation, financial performance and talent development”.
It added that the deal would strengthen its US commercial middle market and specialty lines franchise with additional industry verticals.
Meanwhile, it said the deal would significantly broaden its specialty and surplus lines business.
“[The deal] deepens expertise in major US industry segments by adding specialty lines coverages and markets where The Hartford does not currently underwrite or have a significant market presence, including: marine, energy, environmental, construction wrap ups, international and A&H,” the insurer said.
“[It also] increases scale of The Hartford’s existing positions in construction, professional liability, financial products and life sciences.”