American International Group (AIG) has agreed to buy Hamilton USA from Hamilton Insurance Group.
The announcement comes after AIG, Hamilton Insurance Group and Two Sigma Insurance, an independent affiliate of Two Sigma Investments, said that they had agreed on a memorandum of understanding (MOU) that should expand their partnership with a view to leading the data-driven evolution of underwriting. The agreement is subject to regulatory approval.
Under the agreement, Hamilton Re and AIG will enter into a reinsurance strategic partnership in which Hamilton Re will be provided with the 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.
“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,” said Hamilton chairman William Freda. “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.”
The agreement also comes a day after former Hamilton president and CEO Brian Duperreault joined AIG as its new CEO.
According to the companies, the MOU underscores their commitment to transform commercial insurance through data science and technology. It follows the three companies’ investment in Attune, the data-enabled technology platform launched in September 2016 to serve the US small to medium-sized commercial insurance market.
Under the terms of the MOU, Attune’s target market will be expanded to include companies with annual revenues of up to $35 million, a target market segment of up to $150 billion in annual gross written premiums. Hamilton will retain its one-third ownership of Attune.
AIG said that its acquisition of Hamilton USA will allow it to continue accelerating its application of data science and analytics to transform underwriting.
AIG, Hamilton Insurance Group, M&A, Two Sigma, US, Bermuda, Reinsurance, Technology, Attune