China Reinsurance Corporation (China Re) is to acquire insurance company Chaucer Group for $865m.
The acquisition will accelerate China Re’s overseas deployment, with Chaucer regarded as a vehicle for increasing China Re’s underwriting and technical expertise.
Headquartered in London and rooted in the Lloyd’s market, Chaucer is a leading global specialty insurance and reinsurance company in terms of underwriting capacity and profitability. Chaucer operates 45 product lines globally with written premiums of $1.2bn in 2017 and an average ROE of 12.1% from 2015 to 2017. Chaucer manages Syndicate 1084 (the 11th largest syndicate at Lloyd’s) and Syndicate 1176 (a leading nuclear insurance syndicate), in which its economic interest is 100% and 57% respectively. In addition, Chaucer engages in international (re)insurance business outside the Lloyd’s market through its company platform in Ireland.
Yuan Linjiang, chairman of China Re said the acquisition of Chaucer is a major strategic step taken by China Re in response to the nation’s call to “build China Re into a world-class modern reinsurance group”. It is also a milestone in China Re’s international development which is an integral part of its “One-Three-Five” Strategy. We are deeply impressed by Chaucer’s long history, outstanding management and corporate teams, robust profitability and strong risk management capabilities. With Chaucer’s established market leading position in specialty insurance, we are convinced that with this acquisition, our Group’s core competitiveness and capacity to serve “the Belt and Road Initiative” will be greatly strengthened. Together, we will secure greater and more diversified business and a higher status in international markets.
He Chunlei, vice chairman and president of China Re said, “As Asia’s leading reinsurance group pursuing international development, China Re regards Chaucer as its ideal partner. We are delighted to be acquiring a top quartile performer in the Lloyd’s market and respect its senior management’s achievements to date in growing the business to this point. We look forward to working closely with John Fowle, Chaucer CEO, and the management team.”
John Fowle, chief executive officer of Chaucer commented，“At Chaucer, we are fully committed to delivering a first class underwriting and claims service to our brokers, cover-holders and clients, and believe that the support of China Re will enable us to build on our success to date, and accelerate our strategy which has profitable growth at its core.”