Continuing with its strategy of repositioning its product line,Allianz SE announced Thursday that it will sell the Fireman’s FundU.S. personal lines insurance, which is focused on high net worthcustomers, to ACE Limited for $365 million.

The sale is in line with Allianz’s plans, announced earlier in2014, to reposition its US property and casualty insurance businessby integrating the Fireman’s Fund Insurance Company (FFIC)commercial business into Allianz Global Corporate & Specialty(AGCS), the global industrial insurer of Allianz Group.

The sale also signals a further decline of the Fireman’s Fundbrand, which is slowly fading after 150 years. Fireman’s Fund wasfounded in San Francisco in 1863 by retired sea captain WilliamHoldredge to protect San Francisco homes and businesses during theboom times of the Gold Rush. The company’s name comes fromHoldredge’s pledge to donate 10% of company profits to the widowsand children of fallen San Francisco firefighters.

For ACE Limited, the acquisition allows it to expand itsposition as one of the largest high net worth insurers in theUnited States. ACE plans to integrate the Fireman’s Fund businessinto ACE Private Risk Services, the division offering coverage forhomeowners, automobile, umbrella and excess liability, collectiblesand yachts, among others.

“High net worth personal lines remains a strategic growth areafor ACE and ACE Private Risk Services has quickly establisheditself in this space,” said Evan G. Greenberg, Chairman and CEO ofACE Limited.

By integrating the Fireman’s Fund personal insurance businessinto ACE’s existing high net worth personal lines business, ACE isabout to add approximately $891 million in premiums written, basedon 2013 figures. The sale includes the renewal rights, reinsuranceof existing liabilities and access to an extensive network of 1,100agents and brokers.

Allianz to grow U.S. commercialP&C business

By divesting itself of the personal lines business, Allianz canfocus on building its commercial P&C business across NorthAmerica under the Allianz brand. Based on 2013 gross premiums, thenew business is expected to have revenues totaling more than $3billion.

The FFIC commercial business will be integrated into AGCS NAwith all active product lines moving to AGCS, Allianz announced.The move is intended to ensure continuity of service for existingcommercial policyholders and agents, while also presenting onebrand and team to customers across all segments of the US P&Cmarket. AGCS also seeks to build on the FFIC product rangeglobally, targeting opportunities to use FFIC’s specialistknowledge of entertainment and mid-corporate insurance ininternational markets.

Allianz also intends to ultimately separate and consolidate thelegacy business of FFIC, including legacy asbestos and environmentexposures, legacy workers’ compensation and legacy constructiondefect liabilities into a standalone company, San Francisco Re.

“These latest moves will complete the picture of thereconfiguration of our property & casualty insurance businessin the United States with a strong footprint in commercialinsurance,” said Axel Theis, incoming Member of the Board ofManagement of Allianz SE. “With this transaction Allianz will alsogain capital efficiencies by releasing capital allocated to thepersonal insurance risks. In addition, we will use the proceeds tofinance the restructuring of the Fireman’s Fund commercial P&Cbusiness. Taken with the creation of the new run-off carrier SanFrancisco Re, these measures enable Allianz to focus its energieseven more strongly on successfully integrating the Fireman’s Fundcommercial business into AGCS.”

Both transactions are pending legal and regulatory approval.Wilkie Farr and Gallagher LLP, led by partner Alexander Dye,represented ACE.