Catalina adds to run-off portfolio with Zurich deal

Catalina Holdings has signed a definitive agreement with Zurich Insurance under which a portfolio of German legacy medical malpractice liabilities in run-off will be transferred to its subsidiary Catalina Ireland.

According to the company, the portfolio consists entirely of German medical malpractice liabilities and as at December 31, 2016 it had insurance liabilities of approximately $450 million. Total assets of Catalina pro forma for this transaction will be excess of $4.1 billion.

Catalina also pointed out that the portfolio transfer is subject to regulatory approval in Ireland and the approval of the High Court of Ireland.

“This transfer from Zurich is one of the largest legacy transactions in continental Europe,” said Chris Fagan, chairman and chief executive of Catalina. “Together with our purchase of Glacier Re in 2010, reinsurance of $200 million of legacy liabilities from Delta Lloyd in 2014 and transfer of €463 million of liabilities from Quinn Insurance in 2015, this transaction clearly positions Catalina as the largest acquirer of legacy liabilities in Europe, with over $3.1 billion of European run-off liabilities acquired to date.

“We are pleased to be working with leading insurance groups like Zurich to help them manage risk and reduce capital and management resources devoted to non-core operations. Our strong track record and global footprint means we are well positioned to provide exactly this value to groups with legacy liabilities. We continue to see growing opportunities as insurance and reinsurance companies dispose of non-core legacy liabilities, helping develop a secondary market for legacy liabilities with compelling economic benefits for both seller and buyer.”