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Weekly News Roundup, May 17

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In this week's news will talk about Gallagher Re on the 'big picture' in the reinsurance market, Progressive Insurance outlines April results, and much more…

AIG to sell part of Corebridge stake to Nippon Life for $3.8 billion

American International Group (AIG) has agreed to sell around 120 million shares of its Corebridge common stock to Nippon Life Insurance Company for $3.8 billion.

The stake being sold by AIG represents 20% of Corebridge’s outstanding shares. Following the transaction, AIG will retain a 9.9% shareholding in Corebridge for at least two years post-closing.

Peter Zaffino, AIG’s chair and chief executive, expressed confidence in the deal, stating: “Nippon Life is well known in the financial services industry for its leadership in the Japanese insurance market and is globally recognized for its strong performance and corporate reputation.
“We are pleased to have Nippon Life become a strategic partner to Corebridge and believe that they will add meaningful value as an investor.

Gallagher Re on the 'big picture' in the reinsurance market

With so many intricacies and niches, it can be easy to lose focus on the ‘big picture’ when it comes to the reinsurance sector and how it’s faring. It is with this in mind that Gallagher Re published its latest ‘Reinsurance Market Report’, offering a snapshot of how the market fared for the full-year 2023.

Discussing some of the key takeaways of the report, Michael van Wegen, head of client & market insights, international, global strategic advisory at Gallagher Re, underscored how capital is rebuilding “quite nicely”. Global reinsurance dedicated capital hit US$729 billion for the 12 month period, up 12% from the restated full-year 2022 base.

“What is interesting is that the growth of capital is very much driven by increased capital build from profits,” van Wegen said. “In the traditional segments, that is the traditional reinsurance companies, we’re seeing very little new capital being invested. Capital inflow there is very limited at only $2 billion.

Allstate's catastrophe losses for April reach new high

Allstate reported an estimated $494 million in catastrophe losses for April, marking its highest monthly loss this year.
The company attributed $491 million of these losses to 11 events, with approximately 80% resulting from four wind, hail, or tornado events. The total also includes claims reserve re-estimates, Allstate stated.

As per AM Best, Aon reported that insurers may have faced billions of dollars in losses due to severe convective storms that affected central US states between April 25 and April 30. Gallagher Re estimated that insured losses from storms between April 25 and April 28 could exceed $1 billion.

Allstate’s net income for the first quarter reached $1.19 billion, a significant increase from a $346 million net loss in the same period the previous year. The company estimated $343 million in pretax catastrophe losses from March events, bringing the total for the first quarter to $731 million.

FM Global launches renewable energy unit

Amidst shifting environmental landscapes and evolving market demands, an increasing number of businesses are pivoting towards sustainable energy solutions.

This transition reflects a growing recognition of the importance of environmental stewardship and the imperative to mitigate climate-related risks.

As organizations navigate these changing dynamics, embracing renewable energy sources is a crucial step towards long-term resilience and competitiveness.

Last week, FM Global announced the launch of its Renewable Energy unit during the RISKWORLD conference in San Diego. Doug Patterson, head of renewable energy, caught up with Insurance Business to speak on the firm’s latest development.

Progressive Insurance outlines April results

Progressive Insurance has released its earnings report for April 2024, during which the insurer’s combined ratio significantly improved compared to the previous year.

According to Progressive, its net premiums written for April 1-30 amounted to $6.18 billion. Net premiums earned, meanwhile, stood at $5.58 billion.

The insurer’s net income last month was $420.3 million. Its total pretax net realized gains (losses) on securities, on the other hand, reached $(266.1 million).

In April, Progressive’s combined ratio improved to 89%, from 97.9% a year ago.