Zurich acquires AIG's travel insurance business

The acquisition is worth $600m.

Zurich Insurance said it has come to an agreement with AIG to acquire its global personal travel insurance and assistance business (AIG Travel) for $600m. This also has the potential of an additional earn-out payment.

This acquisition will combine AIG Travel with Zurich's travel insurance provider, Cover-More Group, expanding Zurich's footprint in the US and making it a leading travel insurer globally.

“Travel insurance is a priority for us. 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.” stated Cara Morton, CEO of Zurich Global Ventures in a press release.

The acquisition will add AIG Travel's Travel Guard brand to Cover-More's multi-brand model, enhancing its presence in the US and providing access to high-quality distribution partners. 

Cover-More will benefit from AIG Travel's global IT platform, enabling the extension of its travel assistance apps to more partners and customers. Zurich will also acquire AIG Travel's global service centres.

The combined annual gross written premiums for the enlarged Cover-More Group are expected to be approximately $2b. 

The acquisition is projected to reduce Zurich's Swiss Solvency Test (SST) ratio by around 4 percentage points. Subject to regulatory approval, the transaction is expected to close before the end of the year.