According to the Nikkei business newspaper on Sunday, Mitsui Sumitomo Insurance Company, a division of Japan’s MS&AD Insurance Group Holdings, will invest roughly $400 million to acquire American reinsurance broker Transverse.
The Nikkei said that the Japanese property insurer wants to learn more about the reinsurance broker industry in order to aid in the growth of a niche insurance market for things like cybercrime.
Depending on the U.S. Company’s earnings following the transaction, Mitsui Sumitomo Insurance may pay up to an additional $150 million, the Nikkei reported, adding that an announcement was anticipated by the end of the month.
In a response, MS&AD claimed that nothing had been decided and that it was still examining a variety of company investment opportunities, including some mentioned in the media.
When a decision was made, it promised to swiftly announce anything that needed to be disclosed.
According to the Nikkei, Transverse, a New Jersey-based company founded in 2018, operates as a broker for reinsurance throughout the country, earning a commission of around 5% of insurance premiums by connecting insurers and reinsurance firms.
Increased sales of policies offered by insurers that specialize in certain industries, including transportation and medicine, are the result of increased risks associated with natural catastrophes, terrorism, and cybercrime in the United States.
However, according to the Nikkei, there is still a lack of universal insurance in Japan against dangers like hacking.
