ZURICH, July 1, 2022
/PRNewswire/ -- Chubb Limited (NYSE: CB) today announced that it
has completed its acquisition of the life and non-life insurance
companies that house the personal accident, supplemental health and
life insurance business of Cigna (NYSE: CI) in six Asia-Pacific markets. Chubb paid $5.36 billion for the operations, which include
Cigna's accident and health (A&H) and life business in Korea,
Taiwan, New Zealand, Thailand, Hong
Kong and Indonesia. The
reduction in the final purchase price from the original
announcement reflects the impacts of rising interest rates and
foreign exchange rates on acquired book value and other minor
adjustments.
This complementary strategic acquisition advances Chubb by
expanding its presence in the Asia-Pacific region, a long-term growth area
for the company. With the addition of Cigna's business,
Asia-Pacific's share of Chubb's
global portfolio will grow to approximately $7 billion in premium from $4 billion, representing about 18% of the total
company premiums, with approximately 95% of the acquired business
contributing to Chubb's Life Insurance segment and the remainder to
its Overseas General Insurance segment. The company's global
A&H writings will increase in size to approximately
$6 billion in premium, up from
$3.7 billion, while the company's
life insurance segment becomes a $5.4
billion business.
"Cigna's business, which is approximately 80% A&H, adds
significantly to our business in Asia," said Evan G.
Greenberg, Chairman and CEO of Chubb. "The Asia-Pacific region offers great potential for
long-term growth and wealth creation. The Cigna businesses have
favorable underwriting margins, produce high-quality earnings, and
are not exposed to the P&C cycle. Chubb is so well positioned
to capitalize on market and product opportunities, including the
cross-selling of Chubb's non-life products to life customers, with
a strong brand, technology, and complementary direct marketing
skills and partnerships.
"At the same time, I am also pleased to welcome nearly 3,000 new
colleagues to Chubb. Together, the leadership and talented
professionals of Chubb and Cigna will enable us to provide greater
value to our customers, distribution partners, and
shareholders."
Key financial aspects of the transaction are positive: earnings
and earnings per share accretion, return on equity accretion and
other deal returns are all expected to be consistent with or better
than what was originally announced. The underlying business remains
strong, with premiums on a constant-dollar basis ahead of plan and
continued positive outlook for premium growth. The efficiencies
created by the transaction are expected to provide greater
flexibility for the company to invest in people, technology,
products and distribution in the region. Expense synergies are now
projected to be at a run-rate of $100
million pre-tax, or 28% higher than previously estimated,
resulting in one-time net integration costs of $140 million pre-tax, which are higher than
originally estimated, reflecting the higher expected ongoing
expense synergies.
Integration planning has been actively underway since the
transaction was announced last October. In Korea, the business will
continue to operate under the LINA name, but with a fresh look that
aligns with the Chubb brand. In other markets, the businesses will
be rebranded as Chubb as the integration progresses and operating
entities are combined.
About Chubb
Chubb is the world's largest publicly traded property and
casualty insurance company. With operations in 54 countries and
territories, Chubb provides commercial and personal property and
casualty insurance, personal accident and supplemental health
insurance, reinsurance and life insurance to a diverse group of
clients. As an underwriting company, we assess, assume and manage
risk with insight and discipline. We service and pay our claims
fairly and promptly. The company is also defined by its extensive
product and service offerings, broad distribution capabilities,
exceptional financial strength and local operations globally.
Parent company Chubb Limited is listed on the New York Stock
Exchange (NYSE: CB) and is a component of the S&P 500 index.
Chubb maintains executive offices in Zurich, New
York, London, Paris and other locations, and employs
approximately 34,000 people worldwide. Additional information can
be found at: www.chubb.com
Cautionary Statement Regarding Forward-Looking
Statements:
Forward-looking statements made in this press release, such
as those related to the acquisition of the businesses noted above,
potential post-acquisition performance, growth opportunities,
integration, and our expectations and intentions that are not
historical facts, reflect our current views with respect to future
events and financial performance and are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. Such statements involve risks and uncertainties that could
cause actual results to differ materially from such statements,
including without limitation, statements about the anticipated
benefits of the proposed transaction, including future financial
results; the receipt of any required regulatory approvals and
completion of other closing conditions; our ability to integrate
the acquired businesses, operations and employees; general
competitive, economic, political, insurance and reinsurance
business market conditions; and judicial, legislative, regulatory
and other governmental developments, as well as management's
responses to these factors, and other factors identified in our
filings with the Securities and Exchange Commission.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the dates on
which they are made. We undertake no obligation to publicly update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
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SOURCE Chubb Limited IR