After signing a letter of intent (LOI) to sell crop insurance company Heartland Crop Insurance, Everest Re Group plans to enter into a strategic long term reinsurance relationship CGB Diversified Services (CGB DS).
As part of the partnership, Everest will provide quota reinsurance capacity on the combined crop insurance portfolio of the Diversified/Heartland companies.
CGB DS, a crop insurance company in the US that offers products and services to farmers across 38 states, will be able to expand its product set and significantly increase its market share in a number of states through this acquisition of Heartland.
John Doucette, president and chief executive officer (CEO) at Everest Re, commented: “We are excited to enter this strategic reinsurance partnership with CGB DS. They are a well-respected crop insurance operation in the US with strong market penetration. This alliance provides Everest access to a much broader, more diversified, crop insurance portfolio.”
Dom Addesso, president and CEO of Everest Re Group, added: “CGB DS presented us with a compelling strategic option. The opportunity to grow and diversify in the crop insurance business at a much more rapid pace and with economies of scale is an extremely attractive alternative.”
Ron Miiller, president of CGB Diversified Services, said: “CGB Diversified Services could not be more pleased to welcome the Heartland family of employees, its agents and customers to CGB.
“We look forward to collectively accomplishing many of the goals we share together. Our combined strength will make us a significant force in our industry in the years ahead.”
This transaction is contingent upon all customary closing provisions, including the finalisation of the Stock Purchase Agreement, and all required regulatory and Board approvals.
Everest Re, Heartland Crop Insurance, CGB Diversified Services, M&A, Insurance, Reinsurance, Bermuda, North America