International specialty property and casualty insurer expands presence in Canada
TORONTO, Aug. 31 2009 – Markel International, a specialty property and casualty insurer, has today announced it has reached agreement to acquire Elliott Special Risks (ESR), a Canadian company that is the leading Managing General Agent in Canada.
ESR provides insurance underwriting and administrative services on behalf of other insurers. The acquisition is expected to close on October 1 and values ESR at CDN $75 million. In 2008 ESR reported gross premium income of CDN $113 million. ESR is being sold by Newport Partners Income Fund (TSX:NPF.UN).
The acquisition is part of Markel’s plans to develop further its international portfolio of specialist insurance businesses. ESR will continue to trade under its own name as a wholly-owned Markel subsidiary.
The acquisition will make Markel International one of the leading players in the Canadian specialty insurance market and comes four years after the establishment of MINT Canadian Specialty, its service company in Toronto.
Markel International writes specialty property, casualty, professional liability and marine insurance, as well as reinsurance, on a worldwide basis. In 2008, Markel International’s gross premium volume was US $693 million. Markel International is a wholly-owned subsidiary of Markel Corporation (NYSE: MKL), which underwrites specialty insurance products and programs to a variety of niche markets. Markel Corporation had gross premium volume of US $2.2 billion for 2008.
ESR was established in 1966 and today employs 80 staff in Toronto and Montreal. It provides a range of specialty insurance products such as Environmental Impairment, Exporters Liability, General Liability, Errors and Omissions, Directors and Officers, Non-standard Property and Umbrella and Excess Liability risks. Historically ESR has utilized a network of insurance companies and Lloyd’s syndicates, including Markel International, to provide insurance pools for the various lines of business. An insurance pool is a group of insurance companies that combine their assets to cover complex risks.
William Stovin, President and Chief Operating Officer of Markel International, said: “We’ve been working closely with ESR as an insurer and a reinsurer since 1993 and have the highest regard for its underwriting skills and capabilities across a range of specialist lines. It is clearly the leading Managing General Agent in Canada and its focus fits well with Markel’s commitment to profitable underwriting in niche areas.”
“There is strong potential to develop and extend ESR’s offering from Markel’s existing range of products, and we are looking forward to reviewing opportunities with the ESR team and the broking community. We are committed to developing the ESR business and providing the necessary capital to do so. At the same time, we look forward to continuing to work closely with other pool members with whom we have acted as co-insurers over recent years.”
Mario Sousa, President of ESR, said: “Markel International has the insurance expertise, the commitment to underwriting excellence and the access to capital to make it an ideal owner of our business. We’ve had the opportunity to get to know the company and its approach for over 15 years and we’re looking forward to being part of the company. Markel’s commitment to the continued success of ESR is great news for the brokers we work with, for our supporters and partners and for our staff.”
Mr. Stovin added: “Our continued expansion in Canada is a further step in the development of our international business, which is of growing importance to Markel as a whole. We remain committed to building a portfolio of specialized insurance operations worldwide.”
About Markel International Limited
Markel International Limited is a specialty property and casualty insurer. Based in London and comprising the international operations of Markel Corporation, it wrote gross premiums in 2008 of US $693 million. In the first half of 2009 Markel International reported gross written premiums of US $358 million and reported a combined operating ratio of 94% compared with a ratio of 98% for the comparable period in 2008. Markel International has six operating divisions writing business either through Markel Syndicate 3000 or through Markel International Insurance Company Limited. Markel Corporation is a US listed business, capitalized at around US $3 billion, which wrote gross premiums of US $2.2 billion in 2008. www.markelintl.com