LCCG to acquire UK insurer Equitable Life
Specialist insurer Life Company Consolidation Group (LCCG) has agreed to acquire UK's mutual life insurer Equitable Life. The transaction is expected to complete towards the end of 2019.
LCCG has signed an agreement with The Equitable Life Assurance Society to transfer the company and all of its business to Reliance Life, a specialist UK run-off manager established by LCCG.
The transaction will maximise the capital distribution to members while managing the administrative costs of a life insurance business in run-off.
As part of the process, ‘with profits’ policies will convert to ‘unit linked’ funds and are expected to benefit from an increase in the current 35 percent capital distribution to a level expected to be between 60 and 70 percent. The transfer to Reliance Life will provide policyholders with access to a broad range of funds.
The deal forms part of LCCG’s strategy to acquire open and closed book insurance assets in the UK and Europe. LCCG has operations in the UK, Republic of Ireland and the Isle of Man, having previously acquired ten businesses, including from Aviva, AXA and Generali.
Total policyholder assets of the LCCG group are currently around £24 billion and predominantly unit-linked.
Paul Thompson, group chief executive of LCCG, said: “We are delighted to have been selected by Equitable Life to be its partner in providing on-going service, fund choice and security to its policyholders. As a group we have significant experience in delivering policyholder value through well-managed run-off processes and our expertise in unit linked assets.
“We continue to see significant opportunities to add to our run-off assets through additional closed book life insurance transactions.”
Ian Brimecome, chairman of Equitable Life, commented: “While it will be sad to bring an end to the oldest mutual assurer in the world, the potential to enhance with-profits policy values to the extent made possible by a transfer to Reliance Life is fundamentally helpful in distributing capital to our policyholders as fairly and as soon as possible. I believe Reliance Life’s approach to customer service, investment choice and policyholder security make for a compelling way forward.”
Make sure you are GDPR compliant and confirm your email address to keep getting our daily emails
More of today's news
AM Best upgrades PartnerRe on strong balance sheet
JLT expands M&A insurance practice with Allied World hire
Ardonagh Group hires former Lloyd's CEO Ward
Coface appoints Natixis CEO as chairman of the board
Mapfre unit placed under review with negative implications after acquisition
