Zurich Insurance Group and Beazley have agreed in principle on the key financial terms of a $10.8bn (£8bn) takeover proposal.

The proposal involves a cash acquisition by Zurich of all Beazley shares in issue and to be issued.

It would offer Beazley shareholders up to 1,335p per share, which includes a cash payment of 1,310p and an additional dividend of up to 25p per share relating to Beazley’s 2025 financial year.

In a statement sent to Life Insurance International, Moody’s Ratings VP-senior credit officer Helena Kingsley-Tomkins said: “Zurich’s bid for Beazley would accelerate its specialty insurance ambitions, adding scale in fast-growing areas like cyber. But the deal’s high price and integration hurdles mean Zurich would face elevated execution risk and a short-term weakening of surplus capital.”

The cash component of the offer marks a 59.8% premium over Beazley’s closing price of 820p on 16 January 2026, the last working day before the start of the offer period.

It is also 59.4% above the stock’s 30-day average price of 822p as of that date and 34.6% higher than Beazley’s previous record price of 973p on 6 June 2025.

Beazley reported that if the proposed dividend is paid in full, shareholders would receive around £8bn in total.

This figure is around 62.8% greater than Beazley’s market value implied by its closing price on 16 January.

The deal would bring together Zurich and Beazley’s operations, creating a specialty insurance group with approximately $15bn (SFr11.66bn) in gross written premiums and drawing on Beazley’s presence at Lloyd’s of London.

Zurich has stated its intention to move forward with due diligence and work towards a formal offer.

In recent weeks, a report by the Financial Times indicated that Zurich is planning to establish its first Lloyd’s syndicate.

Earlier this week, the Swiss insurer confirmed it had acquired around 1.47% of Beazley’s shares, totalling roughly 8.87 million shares.