Tokio Marine HCC plans to acquire the medical stop-loss operations of American International Group (AIG).
Neither side is disclosing financial terms in the deal, which is expected to close on Oct. 15. But the operations in question produce $350 million in gross written premium, according to the deal announcement.
Beyond the pure medical stop-loss product, the to-be-acquired business includes a $35 million organ transplant book, which Tokio Marine HCC said is a new profitable product addition to its own medical stop-loss portfolio.
Combining AIG’s medical stop-loss operations with its own will boost the value of Tokio Marine HCC’s medical stop-loss business to more than $1.3 billion in premium, making it a major player in the sector.
Tokio Marine HCC describes its stop loss coverage as a layer of insurance designed to provide protection to employers who choose to self-fund their health benefit plans. The insurer noted that self-funding can reduce costs, but also leave the employer vulnerable to risks from large catastrophic claims, which is where the Tokio Marine HCC coverage comes in.
Source: Tokio Marine HCC
This article was originally published in Insurance Journal’s sister publication, Carrier Management.com, the insurance C-suite publication from Wells Media Group.