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Samsung Fire & Marine wraps up Canopius investment

4th November 2019 - Author: Matt Sheehan

Samsung Fire & Marine Insurance (SFMI), part of the Korean tech giant, has completed its strategic investment in global specialty lines re/insurer Canopius.

handshakeFirst announced in May 2019, the deal has allowed SFMI to become a significant minority investor in Canopius.

Notably, SFMI and Canopius have now said that in addition to the investment, they will actively explore business opportunities together in specialty insurance and reinsurance.

In particular, these opportunities will focus on the United States and Asia-Pacific regions, the parties confirmed.

“It is my great pleasure to welcome SFMI as a strategic business partner and investor in Canopius,” said Canopius Chairman Michael Watson.

“SFMI’s exceptional financial strength and complementary licence network will be hugely advantageous as we take further transformational steps to build a leading global specialty (re)insurance franchise,” Watson remarked. “We look forward to collaborating with SFMI with great enthusiasm.”

The SFMI investment is expected to support Canopius’s growth arising from the recent acquisition of AmTrust at Lloyd’s and merger with its own Lloyd’s interests.

The merger, which completed early last month, will see Canopius Lloyd’s Syndicate 4444 and AmTrust Syndicate 1861 combine to create a top-five Lloyd’s insurer with combined premiums of roughly £2.2 billion.

The partnership with SFMI and the merger with AmTrust also recently led rating agency AM Best to remove the under review with negative implications status from Canopius US Insurance, Inc. and Canopius Reinsurance AG.

At the same time, AM Best affirmed the Financial Strength Ratings of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” of both Canopius Group subsidiaries, and assigned them a stable outlook.

Canopius’ operating performance was affected negatively by catastrophe losses in 2017 and 2018, but analysts believe the re/insurer has moved towards a more conservative investment allocation and a reduction in catastrophe exposure.

In the medium-term, the company’s balance sheet strength is also likely to be maintained at a very strong level, supported by contributions from SFMI and AmTrust.

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