AIG and Munich Re have announce that AIG Life Ltd. (AIGLL), a UK subsidiary of AIG Life & Retirement, has agreed to acquire Ellipse, a specialist provider of group life risk protection in the UK, from Munich Re.
Ellipse’s group protection capabilities, which include life, critical illness and income protection products, along with its technology-enabled business model with high levels of straight through processing, will position AIGLL to efficiently manage group risk schemes for companies of all sizes.
Kevin Hogan, Executive Vice President and Chief Executive Officer, AIG Life & Retirement, said, “The acquisition of Ellipse reflects our disciplined approach to selectively expanding our existing Life & Retirement businesses while pursuing opportunistic growth. Ellipse brings a strong team with a scalable business platform to our well-positioned, technology-driven UK life business. We look forward to welcoming the Ellipse team to AIG.”
“Ellipse’s group life business is highly complementary to AIG’s existing UK Individual Protection offering. It positions us to capitalize on the strong growth potential in the UK group market by allowing us to provide a holistic suite of innovative protection products that better serve our clients and partners,” said Adam Winslow, CEO, AIGLL. “Additionally, I’m excited to start working side by side with our Ellipse colleagues, who share a similar culture and entrepreneurial spirit, a mono-line protection focus and recognized technology leadership.”
Thomas Braune, Munich Re’s Chief Executive of Life and Health Reinsurance in Europe, Latin America and the Middle East, said, “We are glad to have found a trusted partner for this deal in AIG, pairing the right strategic fit on their side with a good opportunity for us to re-focus our UK market approach. This is a great opportunity for both sides and we are looking forward to completing this deal soon.”
Lee Lovett, Chief Executive Officer of Ellipse, added, “I would like to thank Munich Re for supporting the development and growth of Ellipse over the last 9 years, such that we are now recognized as a mainstream group risk insurer. We now look forward to the next exciting chapter of our growth story with our new owner, AIG Life.”
Since its launch in 2009, Ellipse has grown to become the 6th largest UK group life provider based on 2017 new business volumes. Ellipse has reached an 8% share of new business premiums and a 4% share of in-force premiums in 2017. As of May 2018, the company holds approximately £64 million of in-force premiums and nearly 4,500 in-force policies covering over 370,000 lives.
The transaction, the terms of which were not disclosed, will be fully funded with cash. The acquisition is expected to close in the first quarter of 2019, subject to required regulatory approval.
Munich Re was advised by Fenchurch Advisory Partners.
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