Pending regulatory approvals, the deal is slated to close in the second quarter of 2021.
It’s official. The Farmers Group and Metropolitan Property and Casualty Insurance Company have signed a definitive agreement that will see the Farmers Exchanges acquire MetLife”s Auto & Home Business in an all-cash deal valued at $3.94 billion. The Farmers Group, Inc. (FGI) and Farmers Exchanges, are a wholly owned subsidiary of the Zurich Insurance Group.
The following are MetLife President and CEO Michel Khalaf’s comments on the sale:
“Following our recently announced acquisition of Versant Health, which will catapult MetLife to the No. 3 vision care provider in the U.S. by membership, this transaction is another bold step in the execution of our Next Horizon strategy. It will allow us to focus on our core strengths, simplify the company operationally, and further differentiate our offering in the critically important employee benefits space.
“The employees dedicated to MetLife Auto & Home have built a strong business and will now become part of one of the country’s leading personal lines insurance companies. By combining the power of MetLife’s group benefits channel with Farmers’ high brand recognition and 90 years of personal lines excellence, we are enabling each company to do what it does best.
“We look forward to continuing to meet the expectations of our group customers, preserving strong relationships with our distribution partners, and providing employees across the U.S. with attractive benefits through our partnership with Farmers.”
A 10-year ‘Strategic Partnership’ is also part of the deal
A 10-year strategic partnership between MetLife and the Farmers Exchanges is also an integral part of the new deal. The partnership will give the ability of Farmers Insurance® (Farmers) to offer its personal lines products via MetLife’s industry-leading U.S. Group Benefits platform. The platform current reaches 3,800 employers and approximately 37 million eligible employees.
Lastly, the strategic partnership will see Farmers gaining access to MetLife’s network of 7,700 independent agents as well as ” assume responsibility for MetLife’s existing retail property and casualty customers.”
Deal expected to close in the first half of 2021
Pending customary closing conditions, as well as the regulatory hurdles and approvals an acquisition like this entails, both MetLife and Farmers expect the transaction to close in the second quarter of 2021 (Q2-2021). MetLife is planning to report its P&C business as a ‘divested business’ in the first quarter of the next year.
With the addition of MetLife’s P&C Business, Farmers will likely surpass Boston-based Liberty Mutual as the sixth-largest Private Passenger Auto Insurer in the U.S. In the homeowner’s market, the addition of MetLife’s Home business could likely see it likely move up a couple of notches to become the third-largest Homeowner insurance in the U.S.
