(Source: PRNewswire)
LOS ANGELES, July 1 /PRNewswire/ -- The Farmers Insurance Group of Companies(R) announced today that it has completed the acquisition of 100 percent of AIG's U.S. Personal Auto Group, which includes 21st Century Insurance. In addition to 21st Century Insurance, the acquisition includes the former AIG Direct business and Agency Auto business. The purchase price amounts to approximately $1.9 billion.
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Under the agreement, AIG's U.S. personal auto insurance business is being sold to Farmers Group, Inc., a Los Angeles-based subsidiary of Zurich Financial Services Group. Farmers Group, Inc. will sell the underlying insurance entities to the Farmers Exchanges, which Farmers Group, Inc. manages but does not own, for approximately $1.4 billion.
This acquisition by the Farmers Exchanges strengthens Farmers' place as the 3rd largest personal lines insurer in the US. And, the acquisition positions the Farmers Exchanges as the largest auto insurer in several states, including California. The acquisition is the largest in the 81-year history of Farmers.
The acquired companies operate in 49 states and Washington, D.C.; have more that 2.4 million customers; and insure more than 4 million vehicles in the US. Further, 21st Century Insurance is the nation's 3rd largest traditional "direct" writer of insurance. Without including 21st Century customers, Farmers already provides auto, home, business, specialty, life insurance and financial services to 10.5 million US households.
Farmers Group, Inc. CEO F. Robert Woudstra described the acquisition as a "positive and historic milestone for Farmers, 21st Century, Farmers agents, and, most importantly, insurance consumers across the United States."
"We welcome 21st Century CEO Tony DeSantis and his highly professional and accomplished management team and employees into the Farmers family," Mr. Woudstra said. "This acquisition represents a perfect strategic business fit and will dramatically transform the insurance landscape by positioning Farmers as the leading multi-line, multi-channel insurer in the United States. Most importantly, this acquisition enables us to accommodate the shopping needs of all insurance consumers."
In addition to the positive impact on consumers, Mr. Woudstra explained, that Farmers' vast national network of insurance agents also will benefit from the acquisition. "This acquisition will enable 21st Century customers to have access to Farmers agents, who can help them with their other insurance needs, such as homeowners, business, specialty products, life insurance and financial service products," Mr. Woudstra said.
