Life insurer MetLife has reached an agreement with Zurich, via its subsidiary Farmers Group, over the $3.94 billion sale of its US property and casualty business.
This deal, initially reported in November, will see Farmers Group jointly acquire MetLife Auto & Home with the Farmers Exchanges, a group of three reciprocal insurers.
It’s been reported that Zurich will contribute $2.43 billion to the deal while the Farmers Exchanges will contribute $1.51 billion.
Completion of the transaction is subject to regulatory approvals and expected to close during the second quarter of 2021.
As part of the transaction, the Farmers Exchanges will enter into a ten-year exclusive distribution agreement with MetLife.
Under the agreement, Farmers and MetLife plan to leverage combined capabilities to offer personal lines products on MetLife’s US Group Benefits platform.
“Following our recently announced acquisition of Versant Health, which will catapult MetLife to the No. 3 vision care provider in the U.S. by membership, this transaction is another bold step in the execution of our Next Horizon strategy,” said MetLife President and Chief Executive Officer Michel Khalaf.
“It will allow us to focus on our core strengths, simplify the company operationally, and further differentiate our offering in the critically important employee benefits space.
The acquisition will bring roughly 3,500 MetLife Auto & Home employees to Farmers.
Farmers will also gain access to additional independent agents via the MetLife Auto & Home network.
Additionally, Farmers gains access to about 250 affinity groups through MetLife’s affinity channel.
“The acquisition of MetLife Auto & Home is a unique opportunity to accelerate our growth and gives us a significant presence in all 50 states,” said Jeff Dailey, CEO of Farmers Group.
“MetLife’s distribution channels complement our existing strength in the exclusive agent channel, deepen our presence in the fast-growing independent agent channel and provide us entry into the worksite marketing channel via a leading platform, with the 10-year exclusive distribution agreement through MetLife Group Benefits.”