Bermudian insurance and reinsurance firm XL Group Ltd. has sent a letter to its reinsurance brokers, to explain that they should expect continuity in the way it operates and its trading after its acquisition by French insurance and investment giant AXA is completed.
The letter, penned by Chief Executive of Reinsurance Charles Cooper, explains that XL’s reinsurance broker partners have played a key role in the firms success, helping it to reach its $4.7 billion of premiums written in 2017, with over 600 employees in 18 countries.
Cooper explained that the “unwavering support” of its reinsurance brokers helped XL to grow since the formation of XL Catlin nearly three years ago, which has now put it in the position of being an attractive commodity for much larger players and resulted in the approach from AXA and the subsequent acquisition agreement.
Cooper explained that the acquisition by AXA, “creates a powerful opportunity to continue the XL Catlin strategy with greater strength and a new dimension.”
“I’m excited about what this all means, including that we will have the support of a bigger balance sheet to provide greater security and solutions for emerging and evolving risks. In fact, we will have one of the largest market caps of companies in our industry,” he wrote in the letter.
Importantly for the broker audience he was writing to, Cooper said that there was little overlap between XL and AXA, particularly from a reinsurance standpoint, meaning that the pipelines of risk into XL and out again in the form of reinsurance and retrocession will stay on.
Additionally, Cooper noted that XL and AXA’s reinsurance would come under Greg Hendrick, so providing continuity and he said that the focus on “superior underwriting, innovation and highly responsive client service” would remain unchanged.
“We expect a smooth integration,” he insisted.
Until the deal is completed XL and AXA will operate as distinct and separate entities, Cooper said.
Adding that, “When the transaction closes, given that AXA does not currently operate in Reinsurance, we don’t expect any significant changes to our Reinsurance business.
“We plan to continue to provide you and our clients the superior service and innovative solutions that you have come to expect from us.”
Reinsurance brokers and partners of XL will be pleased to hear that continuity is the order of the day and for some the prospects of XL becoming part of the much larger entity of AXA Corporate Solutions insurance and reinsurance division will be attractive, as it could result in even more risk opportunities on both sides of the enlarged, post-acquisition business.
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