In 2018, AXA acquired XL Catlin for US$15bn. The acquisition came during the time when the insurance industry was facing digital disruption and changing the regulatory landscape.
The acquisition resulted in the creation of AXA XL and the move helped AXA to desensitize itself to volatile financial risks and focus on lines of business that are close to the customer. The acquisition saw divestitures of its life and annuities businesses and the focus shifted to three growth segments – Health, Protection and Commercial P&C insurance.
XL gave AXA scale and its acquired commercial relationships opened doors for the health and protection businesses. The acquisition allowed it to leapfrog many years to organizational organic development.
Prior to the acquisition, XL Catlin has had its own share of restructuring by providing emphasis and importance to talent over bureaucracy. The new structure had the teams at the top and management at the bottom more so like an inverted pyramid.
The acquisition by AXA provided XL with the resources to build its scale, geographical footprint, product portfolio and innovation.
The acquisition aligned AXA to its Ambition 2020 which favored product lines with high-frequency customer contacts, quality service and superior technical expertise. XL Group provides both a premier speciality platform complementing and diversifying AXA’s existing commercial lines insurance portfolio and reinsurance capabilities that will allow AXA an access to enhanced diversification and alternative capital.
With the combination, AXA XL aims to become #1 in P&C Commercial Lines.
“XL Group has the right geographical footprint, world-class teams with recognized expertise and is renowned for innovative client solutions. Our combined P&C Commercial lines operations will have a strong position in the large and upper mid-market space, including in speciality lines and reinsurance, and will complement and further enhance AXA’s already strong presence in the SME segment. The two companies share a common culture around people, risk management and innovation, positioning AXA uniquely for the evolving future of the P&C industry”, said Thomas Buberl, Chief Executive Officer of AXA.
The acquisition also helped AXA to review its plan to exit the US markets, by accelerating its presence than exiting. Recently, AXA XL’s marine business along with Vindati, an n InsureTech Managing General Underwriter (MGU) has teamed up to offer US brokers access to Customized Ocean Cargo Insurance for SMEs Via Vindati’s proprietary rate, quote, bind, issue online platform.