Zurich Insurance has announced that its subsidiary Zurich Investments Life plans to offload its Italian life and pension back book to Portuguese insurance firm GamaLife.
The life and pension back book up for sale comprise both traditional and unit-linked policies that will release nearly $1.2bn of capital.
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The deal, which will see the transfer of nearly $9.5bn of net reserves to GamaLife, will add 11 points to Zurich’s Swiss Solvency Test ratio.
It is also expected to increase Zurich’s liquidity by approximately $200m while reducing its exposure to interest rates and credit risks.
Zurich chief financial officer George Quinn said: “We are confident that GamaLife will continue to provide our customers with the same high quality of service that they expect. The Italian life insurance and pension market are important for us and the recent acquisition of Deutsche Bank’s Italian financial advisor network provides a strong platform for further growth in our preferred products.”
GamaLife CEO Matteo Castelvetri said: “Together with Zurich, we believe this transaction represents a strong strategic alignment between GamaLife’s focus on sustainable growth and Zurich’s intention to exit the legacy business in Italy. Our focus will be to ensure a seamless transition for all local stakeholders and to bring our values of innovation, simplicity and service across the enlarged GamaLife group.”
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By GlobalDataZurich noted that the deal does not impact the contractual obligations toward policyholders and distributors. It will continue to provide protection and unit-linked solutions to Italian customers.
The deal awaits regulatory approval and is expected to close in the second half of 2022.
