Randall and Quilter Investment (R&Q) has agreed to divest 100% of its Lloyd’s managing agency, R&Q Managing Agency (RQMA), to US-based Coverys.
After considering costs and related incentive payments, Bermuda-based R&Q will end up with estimated net proceeds of £13.9m which will be used to help fund its transaction pipeline, primarily in the US and in Lloyd’s.
It will also be used for creating valuable commission income from the use of Accredited and Malta’s direct licenses, stated R&Q.
RQMA is a managing agency that helps new syndicates in launching their underwriting businesses at Lloyd’s. It also delivers operating services needed for the underwriting and maintenance of existing syndicates such as Syndicate 1991 and Syndicate 3330.
For the Boston-headquartered Coverys which provides medical professional liability insurance products, the acquisition will pave way for the company’s entry into the London marketplace.
Coverys CEO and President Gregg Hanson said: “Through the acquisition, Coverys will inherit the continued responsibility to support the syndicates currently under management with RQMA.
“The acquisition additionally allows Coverys to assist new underwriting syndicates that seek to launch their business at Lloyd’s, while also maintaining business operations for existing syndicates.
The sale from R&Q Investment is in line with its earlier decision to simplify its operations to focus on core, high-growth operations. These include acquisition or assumption of run-off portfolios and of its licensed US and EU companies as medium for niche and profitable books of property and casualty business, mainly to high-rated reinsurers.
R&Q chairman and CEO Ken Randall said: “R&Q Managing Agency Ltd is a well-developed and scalable platform and we are confident it will prosper under the stewardship of Coverys. We have enjoyed working with Coverys for several months to assist in the further development of their business in the London market.”
“There is a good cultural “fit” between the two organisations and we look forward to continuing the relationship in respect of Syndicate 3330 and exploring opportunities to work together in the future.”
R&Q’s divestiture is subject to regulatory change of control approval by Lloyd’s and the PRA which are expected later this year.
Last week, Randall and Quilter completed a loss portfolio transfer reinsurance contract with a California based insurance group.
Image: Randall and Quilter to divest Lloyd’s managing agency RQMA. Photo: courtesy of adamr/ FreeDigitalPhotos.net.