Zurich in $3.9b deal to buy MetLife unit

ZURICH: Zurich Insurance said Friday its US subsidiary Farmers Group and Farmers Exchange will buy the property and casualty unit of US insurer Met Life for $3.9 billion in a deal that will expand it reach.

Zurich said it expects the deal, which it hopes will conclude by the middle of next year pending regulatory approval, will be profitable in its first year and deliver a return on investment of approximately 10 per cent from 2023.

“The transaction gives the Farmers Exchanges a truly nationwide presence and access to new distribution channels with the potential to accelerate growth,” it said in a statement.

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The Farmers Exchange is a subscriber-owned cooperative, but it uses Zurich-owned Farmers Group to carry out insurance activities.

The deal gives Farmers a 10-year exclusive distribution agreement for its personal insurance products through MetLife’s group benefits platform that has 3,800 companies and 37 million employees.

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The MetLife property and casualty unit acquired has 2.4 million policies that brought in $3.6 billion in net premiums last year and has 3,500 employees.