istock-578108630_dny59-2-1--1
iStock/ Dny59
20 November 2018Insurance

Run-off specialist DARAG consolidates move into North America with acquisition

Run-off specialist DARAG has completed the acquisition of SOBC Services, a company focused on the sourcing, acquisition and management of insurance entities and portfolios in run off in the US, Bermuda and Caribbean.

The deal, which includes taking on four insurance entities in run-off and a protected cell company in Connecticut, cements the company’s footprint in the North American market. It said it also expects rapid growth in the market driven by the small to mid-sized run-off space.

Stephanie Mocatta will be CEO of this US focused legacy business, which will trade under the name SOBC DARAG. Brian Johnston will be CFO and EVP and Tom Hodson, general counsel. The executive team is complemented by nine other staff, primarily based in Ohio, with US claims, financial, regulatory and operational experience.

The acquisition has been completed via SOBC DARAG Holdings, a wholly owned subsidiary of DARAG Guernsey.

In addition, SOBC DARAG Holdings will acquire from SOBC Corp and SOBC Sandell Holdings, four insurance entities in run-off and SOBC Insurance Company a protected cell company.

The entities in run off are: American Safety Captive Insurance Company in Vermont, which wrote general and professional liability; American Staffing Assurance Company, a protected cell company domiciled in Washington DC which wrote workers’ compensation and general liability protection to temporary staffing agencies; PIA Professional Liability Insurance Company, a captive insurer in Montana, which issued errors and omissions coverage to professional insurance agents; and the economic interest in the Insuratex cell in Bermuda which contains auto liability, general liability and workers’ compensation risks.

Following its recent acquisition of Peachtree in Florida and the change of control approvals for the other entities, SOBC DARAG will own six carriers across the US and Bermuda.

The company stated: “Building on this strong infrastructure base in the US and given an excellent pipeline of transactions, SOBC DARAG is expected to see fast expansion in the small to mid-sized run-off space, whilst also challenging the traditional players at the larger end of the market. The existing SOBC staff, including all the executive team, have transferred to the new operation with immediate effect.”

Mocatta, CEO of SOBC DARAG, said: “This transaction marks a great new chapter. With the capital and expertise of the DARAG Group now fully behind us, we believe there is significant opportunity to develop and grow SOBC DARAG. We have already completed the Peachtree Casualty Insurance Company acquisition and are actively working on a number of other new opportunities. We look forward to the considerable expansion of SOBC DARAG here in the USA as well as in Bermuda and the Caribbean. We would also like to thank our previous capital partners, Sandell, for their support. We have enjoyed working with them for the past 24 months.”

Tom Booth, group CEO of DARAG, said: “Following the equity commitment of €260m ($300m) in July, DARAG announced its intention to expand into the USA and Bermuda markets. The acquisition of SOBC Services via DARAG Guernsey’s wholly owned subsidiary SOBC DARAG Holdings in Delaware, brings onboard an exceptional team of seasoned local professionals. Together with the insurance entities being purchased from the SOBC Group this provides us with a great platform for our future expansion plans in the US legacy market. We have worked closely with the SOBC team on these acquisitions and we are looking forward to continuing our work together and to considerable growth in the coming months and years.”

Get all the latest re/insurance industry news with our daily newsletter -  sign up here.

More of today's news

Beazley, AEGIS lead the Lloyd’s electronic placement table

Willis Towers Watson reveals new chairman

Syndicates accept 30% of risks electronically in Q3

AXA XL snaps up 100% ownership of New Ocean Capital Management

Willis Towers Watson swoops for Lloyd's execs in digital push

Don't miss our insurtech email newsletter - sign up today

Already registered?

Login to your account

To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.

Two Weeks Free Trial

For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Elliot Field at efield@newtonmedia.co.uk or Adrian Tapping at atapping@newtonmedia.co.uk


More on this story

Insurance
11 September 2019   SOBC DARAG, a subsidiary of run-off specialist DARAG UK, has acquired New Mexico P&C Insurance Company, having received approvals from New Mexico OSI and Florida OIR.
Insurance
18 July 2019   Run-off specialist DARAG Group has agreed to acquire London-based non-life reinsurance company One Re, which provided reinsurance to African-based insurers for industrial property risks and engineering projects from 2015 to 2018.
Insurance
5 November 2018   SOBC DARAG, a joint venture between US-based run-off specialist SOBC and European legacy acquirer DARAG, has acquired Florida-based Peachtree Casualty Insurance Company.