Zurich, Switzerland – Zurich Insurance Group has announced an agreement to acquire AIG’s global personal travel insurance and assistance business (AIG Travel) for $600 million. The deal includes the potential for an additional earn-out payment, reflecting Zurich’s strategic move to strengthen its position in the travel insurance market.
Strategic Expansion
The acquisition will merge AIG Travel with Zurich’s existing travel insurance provider, Cover-More Group. This integration is set to expand Zurich’s footprint in the United States and establish the company as a leading global travel insurer.
CEO’s Vision
“Travel insurance is a priority for us,” stated Cara Morton, CEO of Zurich Global Ventures, in a press release. “This transaction is a great strategic fit, which enhances Zurich’s existing capabilities and makes us a leading travel insurance provider across all regions. The acquisition expands our retail customer base and aligns with our ambition to continuously enhance our offerings, while providing world-class protection during every step of our customers’ travels.”
Enhancing Capabilities
The acquisition will incorporate AIG Travel’s Travel Guard brand into Cover-More’s multi-brand model, thereby bolstering its presence in the US market and providing access to premium distribution partners. Cover-More will leverage AIG Travel’s global IT platform, facilitating the extension of its travel assistance apps to more partners and customers. Additionally, Zurich will gain control of AIG Travel’s global service centers, enhancing its operational capabilities.
Financial Impact
The combined annual gross written premiums for the expanded Cover-More Group are expected to be approximately $2 billion. However, the acquisition is anticipated to reduce Zurich’s Swiss Solvency Test (SST) ratio by around four percentage points. The transaction, pending regulatory approval, is expected to close before the end of the year.
The acquisition of AIG’s travel insurance business by Zurich underscores the company’s commitment to expanding its global reach and enhancing its service offerings. This strategic move not only consolidates Zurich’s position as a leading travel insurer but also promises to deliver enhanced value and protection to its customers worldwide.