The takeover, the biggest ever in the insurance sector, will create the world's largest property and casualty insurer by underwriting income. What caused this? Rock-bottom catastrophe insurance premiums, the rise of catastrophe bonds, low interest rates and stiff competition.
Rock-bottom catastrophe insurance premiums, the rise of catastrophe bonds, low interest rates and stiff competition have prompted a wave of acquisitions among underwriters. Chubb shares rose to a record high of $129.31, above the offer price of about $124.13, suggesting some investors see potential for a rival bid. ACE shares rose 5.3 percent. Potential rival bidders include Allianz (ALVG.DE), Berkshire Hathaway (BRKa.N), AXA SA (AXAF.PA) and Travelers Cos Inc (TRV.N), Wells Fargo analyst John Hall wrote in a note. The combined company, which will adopt Chubb's name, will be led by ACE Chief Executive Evan Greenberg, the son of AIG (AIG.N) ex-chief Maurice "Hank" Greenberg.