* Great-West Lifeco Inc. unit Empower Retirement LLC agreed to acquire the retirement services business of Massachusetts Mutual Life Insurance Co. for a total transaction value of approximately US$3.35 billion. The value includes a reinsurance ceding commission of US$2.35 billion and US$1.0 billion of required capital to support the business. The transaction is expected to close in the fourth quarter.
* S&P Global Ratings warned that at least eight of the top 20 reinsurers could see a capital event if insured catastrophe losses reach $60 billion to $70 billion, which it considers an "average level," in 2020. The rating agency calculated that the top 20 global reinsurers' combined catastrophe budget and earnings buffer for a severe catastrophe event in 2020 has dropped to about $14 billion from about $32 billion because of the investment impact of COVID-19 and pandemic-linked losses.
* Meanwhile, Moody's revised the outlook for the reinsurance sector to negative from stable, citing uncertainty around factors including the ultimate impact of the pandemic, low interest rates and declining reserve releases.
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➤ Reinsurance industry can function without Monte Carlo, but wants it back
Virtual meetings are not true replacements for the real thing, according to market participants, although they expect some elements of remote working to remain.
➤ Pandemic forces tech adoption on many in life insurance business – brokerage CEO
Mark Williams, CEO of Brokers International, said the onset of COVID-19 forced digital laggards to speed up their adoption of technology, and has also prompted an uptick in life insurance sales as people confront their own mortality.
➤ Market sell-off drags on insurance stocks; Genworth soars on funding
The S&P 500, which reached an all-time high earlier in the week ending Sept. 4, ended up finishing down 1.65% at 3,426.96. The SNL U.S. Insurance Index slipped 0.15% to 1,080.23.
PROPERTY AND CASUALTY
* Farm Bureau Property & Casualty Insurance Co. has proposed to acquire all of FBL Financial Group Inc.'s outstanding class A and class B common shares that the company or the Iowa Farm Bureau Federation currently does not own for $47 per share in cash, for an aggregate price of roughly $440 million. Farm Bureau Property estimated that the price offered values FBL Financial at roughly 1.06x multiple of its book value per share, excluding accumulated other comprehensive income as of June 30.
* The National Interagency Fire Center said over 5.5 million acres have been burned in the U.S. so far this year, with more than 2 million in California, CNN reported. A total of 76 large wildfires are burning in the country, the center said.
* Sompo Holdings Inc. subsidiary Sompo International Holdings Ltd. will buy Diversified Crop Insurance Services from agricultural products and services provider CGB Enterprises Inc. Nikkei Asian Review reported that the company will pay ¥40 billion to ¥50 billion for Diversified Crop.
* Fidelis Insurance Holdings Ltd. is seeking about $200 million of additional equity and $100 million of new debt through a fundraising round that could take its total new capital to about $1.5 billion, Insurance Insider reported.
LIFE AND HEALTH
* Prudential PLC and AIA Group Ltd. are in advanced talks with Southeast Asia's Grab Holdings Inc., which is seeking between $300 million and $500 million in investment into its financial services unit, Reuters reported, citing people with direct knowledge of the matter. Grab is looking to seal deals as early as October, the people said.
REINSURANCE
* Swiss Re AG expects price increases across all segments to continue during the upcoming renewals season owing to low interest rates, large claims and growing risks.
* The coronavirus pandemic is "the best reminder for us all" about the potential for a cyberattack to cause heavy non-damage business interruption losses, according to Stefan Golling, chief underwriter of Munich Re.
* Also, Munich Re expects claims from the Aug. 4 warehouse explosion at Beirut's port to be in a "low three-digit-million euro" range, mostly relating to property. Torsten Jeworrek, reinsurance CEO at Munich Re, said it was too early to give a precise estimate.
* Randall & Quilter Investment Holdings Ltd. will reinsure the casualty reserves for Lloyd's Syndicate 1458 relating to the 2009 to 2017 years of account under an agreement with RenaissanceRe Syndicate Management Ltd.
MARKETS
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