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R&Q agrees two further minnow legacy deals

London-listed insurance services firm Randall & Quilter (R&Q) has continued its strategy of piecemeal run-off acquisitions after agreeing two deals in the past week, marking its first captive novation in Bermuda as well as its third Finnish acquisition.

R&Q completed a novation of all contracts underwritten by MPPA Insurance to cells in R&Q Quest SAC, the group's Bermuda rent-a-captive facility.

MPPA Insurance was a Class 2 Bermudian captive insurer for the Michigan Plastic Processors Association. The firm wrote excess workers' compensation to protect its self-insured fund and has been in run-off since 2008.

R&Q paid a transaction fee of $3.4mn for transferring assets of $4.9mn and liabilities of circa $0.5mn as at the end of February 2013.

The two front companies, Travelers Indemnity Company and AIG's National Union Fire Insurance Company of Pittsburgh, agreed to the deal.

R&Q CEO Ken Randall said: "Having seen success in other domiciles in the last 12 months, notably Guernsey, we are pleased to now see increasing activity from Bermuda captives looking for exit or restructuring solutions."

Last week, the group also announced its third Finnish legacy transaction.

The Bermuda-domiciled firm acquired a "small portfolio of run-off reinsurance contracts" underwritten by the Finnish insurer Mutual Insurance Company Fennia.

Although no figures on assets or liabilities were released, it is understood that the deal was small and likely under EUR0.5mn in net asset value.

R&Q's new Finnish subsidiary Alma Insurance Company acquired the business via a Portfolio Transfer Plan.

The deal is subject to formal and regulatory approvals and is expected to close in September.

R&Q bought the Finnish legacy reinsurer Alma from Tapiola General Mutual Insurance Company in November for £4.4mn. It used the vehicle earlier this month to complete a EUR0.5mn portfolio transfer with the Finnish mutual Turva.

Alma, Turva and Fennia had all been previously managed together by Tapiola.

The recent deals are R&Q's third and fourth transactions since its £25mn capital injection in April.

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