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AIG, Hamilton & Two Sigma reveal strategic partnerships and MOU

15th May 2017 - Author: Luke Gallin

Following AIG’s appointment of Brian Duperreault as President & CEO and new senior executive appointments at Hamilton Insurance, it’s been revealed that the two companies, alongside Two Sigma Insurance Quantified, plan to expand their relationships, which includes the acquisition of Hamilton USA by AIG.

Senior executive appointments have been announced at both AIG and Hamilton Insurance today, following widespread industry rumours over the past week or so. Now the appointments of Duperreault at AIG and William Freda and David Brown at Hamilton Insurance have been confirmed by the respective companies, the pair, alongside Two Sigma, have announced plans to deepen and expand their relationships via the signing of a memorandum of understanding (MOU).

The MOU is related to the three companies’ investment in Attune, a data-enabled tech platform launched last year and designed to serve the U.S. small to medium-sized commercial insurance market, and highlights the firms’ commitment to utilising data science and technology to advance the commercial insurance industry.

The terms of the MOU state that Attune’s target market will be expanded, and will now include firms with annual revenues of up to $35 million, and a target market sector of up to $150 billion in annual gross written premiums. Furthermore, under the agreement Hamilton Insurance will retain its one-third ownership of Attune.

Duperreault, President and CEO of AIG, said; “Putting data science and technology to work in our industry has been on my agenda for some time. It was the genesis of Hamilton Insurance Group’s formation and will be a primary agenda item at AIG.

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“Through Attune, I’ve learned that cross-industry partnerships – what’s now called insurtech – are the way to go. I can’t think of better partners to have than Hamilton and Two Sigma as we work together to transform our industry.”

It’s also been revealed that a deal in principle has been agreed for AIG to acquire Hamilton USA, the U.S. division of Hamilton Insurance Group. While Hamilton Re, the reinsurance arm of Hamilton Insurance Group, will enter into a strategic reinsurance partnership with AIG. The deal will see Hamilton Re be provided with an opportunity to “participate on market terms in an increased volume of AIG’s ceded reinsurance.”

“The relationship could result in material premium growth for Hamilton Re and provides AIG an alternative source of reinsurance capital,” said the companies.

Finally, AIG and Two Sigma will enter into a partnership that aims to utilise Two Sigma’s data science and technology expertise and experience for a wide range of AIG’s commercial insurance business.

David Siegel, co-Founder and co-Chairman of Two Sigma Investments, said; “Insurance is intrinsic to economic growth. Data science and technology open a world of opportunity for this industry, from more practical protection and smarter processes to a better understanding of risk. This can be done while also lowering costs and more efficiently utilizing resources. We are excited that TSIQ will be working with both AIG and Hamilton to further capitalize on these benefits.”

Chairman of Hamilton Insurance Group, Freda, commented; “Since our founding, Hamilton and its strategic partner, Two Sigma, have been committed to data-driven underwriting and risk management using automated systems, algorithms and data analytics.

“We are excited by the transformative potential the MOU represents for Hamilton through the expansion of Attune’s target market and as new reinsurance opportunities of mutual benefit to AIG and Hamilton Re are explored.”

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