The Lloyd’s insurer’s sales to QBE and RiverStone should release it from a weight of liabilities and capital requirements

Brit finally drew a line under the future of its UK business with the sale of its holding company today.

The insurer has undergone some big changes over the past few months – including QBE buying the renewal rights to its UK regional business – and the sale of Brit Insurance Ltd (BIL) to run-off manager RiverStone completes the final piece of the jigsaw.

The sale, which is expected to complete in the fourth quarter of this year, means that Brit will now underwrite solely from its Lloyd’s syndicate, 2987.

Fewer responsibilities

With Brit having sold its renewal rights to QBE in April, BIL was left with the outstanding claims and liabilities from the UK regional business.

With the sale to RiverStone, Brit has managed to significantly reduce its exposure to liabilities – despite retaining the liabilities and claims handling for certain business within BIL that relate to the ongoing business being written at Syndicate 2987.

The BIL sale has also enabled Brit to free up a large chunk of its capital, as it is no longer has the FSA regulation and rating requirements to hold capital.

People moves

Brit has also undergone some big personnel changes, with chief operations officer Malcolm Beane leaving his post at the end of last month, and Brit UK chief Ray Cox joining QBE, having lost finance chief Scott Egan to Towergate at the beginning of this year.

QBE, meanwhile, has been busy with its own restructure, moving its enlarged UK staff into four new regional office premises in Glasgow, Manchester, Birmingham and Leeds, subsequent to the Brit acquisition, with a number of redundancies resulting from the merger.

Free to progress

BIL’s sale was always on the cards and, with no shortage of bidders, it was only a matter of time once the QBE deal had been concluded that the sale would be finalised.

Brit chief executive Mark Cloutier said the two deals had enabled the company to realise a “meaningful” premium to the book value of those two businesses, and now has plans to cement the insurer as a market leader in global specialty.

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