29 January 2014 Insurance

DARAG closes more deals as run-off booms

Run-off specialist Deutsche Versicherungs- und Rueckversicherungs-AG (DARAG) continued to see an influx of business as it signed three European Run-off portfolio transactions in December, bringing the total number of deals signed in 2013 to seven.

Making its first transaction in Sweden, the company acquired the entire portfolio of group accident insurance with municipalities of the insurance company ERV Sweden. Policyholders were Swedish municipalities who grant accident protection to school children in their community.

“We decided to focus exclusively on our core business again,” said Johannes von Huelsen, CEO of ERV Sweden. “Transferring our run-off portfolio to a specialist insurer was the next logical step. With DARAG we found a partner who responsibly handles our contracts and fulfils our undertaking.”

Aon Benfield advised ERV on the complete project. Jan-Oliver Thofern, Chairman & CEO of Aon Benfield for the German-speaking region said: “The transaction is an excellent example of an established company, which uses run-off as a strategic tool to optimise its business. By attaining finality, ERV Sweden frees resources and reduces complexity.”

DARAG also completed its first transaction in Greece, taking over motor third party liability (MTPL) business from Athens-based AIGAION Insurance Company.

Other transactions included a portfolio of general third party liability from a Belgian insurer via retrospective reinsurance.

“We have underwritten seven portfolios in 2013; that is beyond plan. Our proposition as follow-up insurer and legacy trustee is experiencing a remarkable level of interest,” said Arndt Gossmann, CEO of DARAG.

Terms of the transactions were not disclosed and some transfers are still subject to regulatory approval.

DARAG’s transactions now total 17, with portfolios in 10 European countries.

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