3rd Mar 2014 08:34
LONDON (Alliance News) - Hiscox Ltd Monday said it has agreed to acquire online insurer DirectAsia from the Whittington Group for USD55 million plus an earn out over four years. It said it has "significant" plans to invest in the business, which it says will complement its existing direct-to-consumer retail offering.
Hiscox said the deal supports its strategy to grow its retail lines of business and balance the more catastrophe-exposed, internationally traded lines, which expand and contract according to market conditions.
In a statement, the specialist insurer said the deal to acquire DirectAsia from Whittington Group, a Singapore-headquartered insurance services and investment business, requires some further regulatory approval.
The acquisition has been approved by the Monetary Authority of Singapore and is subject to regulatory approval from the Office of the Commissioner of Insurance in Hong Kong. Hiscox said it has notified Lloyd's of London, as well as a number of regulators, including the UK's Prudential Regulation Authority and the Financial Conduct Authority of the deal.
"DirectAsia is a challenger brand with real potential. It gives Hiscox a 21st century distribution platform in Asia that leapfrogs traditional routes to market. DirectAsia complements our direct-to-consumer businesses in Europe and the US, and in time, we will use it to distribute Hiscox products," Hiscox Chief Executive Officer Bronek Masojada said in a statement.
DirectAsia was founded in Singapore in 2010 and launched into Hong Kong in 2012 and into Thailand in 2013.
Hiscox said DirectAsia has a strong business model and uses market-leading rating mechanisms.
It has over 54,000 customers, employs 140 people across the three locations in which it operates, and in 2013 had gross written premiums of USD25.3 million.
The business will continue to operate under the DirectAsia brand and with the existing local management team, which will be led by Steve Langan, managing director of Hiscox UK and Europe.
Hiscox shares were Monday quoted at 644.50 pence, down 7.50 pence, or 1.2%.
By Samuel Agini; [email protected]; @samuelagini
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