St. Paul Buys Commercial Renewals From Kemper

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By Daniel Hays

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NU Online News Service, May 12, 12:44 p.m. EDT?The St. Paul Companies in St. Paul, Minn. announced today that, foran undisclosed price, it has purchased the right to seek renewalsof Kemper Insurance Companies' commercial insurance business.

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The sale to The St. Paul is the latest batch of renewal rightsselloffs announced by Long Grove, Ill.-based Kemper this year. Thecommercial segment now going to The St. Paul was the subject ofnegotiations that broke off last month between Kemper, SecuritasCapital, LLC, Cypress Merchant Banking Partners II L.P. and GilbertGlobal Partners L.P.

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In January, the insurer sold The Hartford renewal rights to itsgroup captives business and some large risk national accountrenewal business was dealt to Old Republic International ofChicago. Gross premiums for all the business segments being soldwas said to total $1 billion.

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Under latest the agreement, The St. Paul said it will have theright to seek to renewals for a broad portfolio ofproperty-liability insurance.

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A spokesperson for Kemper, Linda Kingman, said the company'smajor focus now is its insurance services business although itretains its Eagle insurance unit, which provides specializedworkers' compensation insurance for maritime and other high hazardindustries.

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Pat Hirigoyen, a spokesperson for The St. Paul said the businessbeing bought would involve significant premiums over time, and is a"really great opportunity for lines we intend to grow."

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He added that a lot of the independent "agents who handle thisfor Kemper are our agents as well." Renewals will be done on apolicyholder-by-policyholder basis and The St. Paul doesn't expectany material effect this year to the company's bottom line, but therenewals, in terms of dollars could amount to "several hundredmillion over time."

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The lines involved include small commercial, middle marketcommercial, inland and ocean marine, and architects' and engineers'professional liability.

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The St. Paul said it is not assuming any liabilities of Kemperor its affiliates.

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Marita Zuraitis, chief executive officer-Commercial Lines at TheSt. Paul, said Minnesota-based company is a major provider ofcommercial insurance, "and the incremental business we expect towrite as a result of this transaction complements our current bookand deepens our relationship with our distribution partners."

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Mike Miller, chief executive officer-Specialty Commercial,added, "A number of key Kemper professionals will be joining theSt. Paul and will work with us to ensure a smooth transition forcustomers as well as agents and brokers."

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