AmTrust Financial Services has sold its personal lines policy management system to National General in a deal worth $200m.
The payment will be made in three equal instalments, with the first paid on agreement of the sale, the second will be paid six months after the sale. The final transaction will be paid when there has been is a full separation and transfer of the full system to National General and 18 months have passed since the sale agreement.
New York-headquartered AmTrust is an insurance company which offers property and casualty insurance products, including workers’ compensation, commercial automobile, general liability and extended service and warranty coverage.
Since 2010, the company has provided National General with IT services for development and licensing of policy management. The initial agreement permitted National General to acquire the license royalty-free in 2023.
Last year, development, support, and licensing fees from National General’s use of the policy management platform, netted AmTrust $26m in pre-tax income.
AmTrust chairman and CEO Barry Zyskind said, “With this sale, which will be immediately accretive to AmTrust’s tangible book value, we are unlocking value that we created through our technological expertise. The proceeds will further strengthen our balance sheet and the transaction demonstrates our commitment to simplifying our organization and financial disclosure.”
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