St. Paul Buys Kemper Renewals The St. Paul Companies announced last week that, for an undisclosed price, it has purchased the right to seek renewals of Kemper Insurance Companies commercial insurance business.
The sale to The St. Paul is the latest batch of renewal right selloffs announced by Long Grove, Ill.-based Kemper this year. The commercial segment now going to The St. Paul was the subject of negotiations that broke off last month between Kemper, Securitas Capital, LLC, Cypress Merchant Banking Partners II L.P. and Gilbert Global Partners L.P.
In January, the insurer sold The Hartford renewal rights to its group captives business and some large risk national account renewal business was dealt to Old Republic International of Chicago. Gross premiums for all the business segments being sold was said to total $1 billion.
Under the latest agreement, The St. Paul said it will have the right to seek renewals for a broad portfolio of property-liability insurance.
A spokesperson for Kemper, Linda Kingman, said the companys major focus now is its insurance services business, although it retains its Eagle insurance unit, which provides specialized workers compensation insurance for maritime and other high hazard industries.
Pat Hirigoyen, a spokesperson for The St. Paul, said the business being bought would involve significant premiums over time and is a “really great opportunity for lines we intend to grow.”
He added that a lot of the independent “agents who handle this for Kemper are our agents as well.” Renewals will be done on a policyholder-by-policyholder basis and The St. Paul doesnt expect any material effect this year to the companys bottom line. But the renewals, in terms of dollars, could amount to “several hundred million over time,” he said.
The lines involved include small commercial, middle market commercial, inland and ocean marine, and architects and engineers professional liability.
The St. Paul said it is not assuming any liabilities for Kemper or its affiliates.
Mike Miller, chief executive officer-Specialty Commercial, said, “A number of key Kemper professionals will be joining The St. Paul and will work with us to ensure a smooth transition for customers as well as agents and brokers.”
Reproduced from National Underwriter Edition, May 19, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.
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