QBE Insurance Group Ltd. of Australia is selling its U.S. agency businesses to California-based Alliant Services Inc. for about $300 million and exiting the distribution business.
The agencies being bought by Alliant include Community Association Underwriters (CAU), Deep South Insurance Services and SIU Managers in California.
However, the deal allows QBE to retain the underwriting on the program business it has with the agencies for a “long-term” period.
Alliant, one of the largest insurance brokers in the U.S., will make an upfront cash payment of $217 million, and pay the remainder over the next five years, according to the terms of the deal.
The sale of the three agency businesses was not a surprise. After QBE Group’s profit declined 18 percent in the first half of last year, the Australia-based insurer began implementing a strategic plan to raise about $1.5 billion through the sale of assets and an initial public offering of its Australian mortgage insurance unit.
David Duclos, chief executive officer for QBE North America, told Carrier Management in November that its three agencies in the U.S. were up for sale.
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