The transaction, first announced in October 2021, includes Cigna’s accident and health (A&H) as well as life business in Korea, Taiwan, New Zealand, Thailand, Hong Kong, and Indonesia.
The deal was originally valued at $5.75bn
However, the deal value was slashed to $5.36bn because of growing interest rates and foreign exchange rates on acquired book value and a few other changes.
With the deal, Chubb will able to expand its portfolio in the Asia-Pacific region from $4bn to around $7bn in premium, representing nearly 18% of the company’s total premiums.
In addition, the size of the company’s global A&H writings will increase from $3.7bn to around $6bn in premium.
Chubb’s life insurance division will grow to become a $5.4bn business.
Cigna plans to use the proceeds from the deal mainly to repurchase share. The company has already invested $3.5bn to fund an accelerated share repurchase plan that was announced last month.
Chubb chairman and CEO Evan G Greenberg said: “Cigna’s business, which is approximately 80% A&H, adds significantly to our business in Asia.
“The Asia-Pacific region offers great potential for long-term growth and wealth creation. The Cigna businesses have favourable underwriting margins, produce high-quality earnings, and are not exposed to the P&C cycle.
“Chubb is so well positioned to capitalize on market and product opportunities, including the cross-selling of Chubb’s non-life products to life customers, with a strong brand, technology, and complementary direct marketing skills and partnerships.”
The company has already started integrating the newly acquired businesses.
In Korea, the business will continue to run under the brand name of LINA, but with a new look.
However, the businesses will be rebranded as Chubb in other regions.