Run-off insurer DARAG spins off classic underwriting business to a ...

PRESS RELEASE
DARAG Deutsche Versicherungs- und Rückversicherungs-AG
Run-off insurer DARAG spins off classic underwriting business to a
separate subsidiary
Specialist insurer DARAG, a pioneer in the assumption of run-off in Germany and Continental
Europe, secures its successful market positioning by spinning off its active underwriting
business into a separate company.
Berlin, 9 September 2010. Since May 2009, DARAG has been offered over 50 potential run-off
transactions of German and foreign insurance companies. 16 buy-out projects have been closely
examined and two run-off acquisitions have been successfully completed to date. Management of its
own run-off portfolio already brought DARAG a profit of EUR 7.3 million in 2009.
Following the restructuring in May of last year, DARAG initially held on to the infrastructure for
conducting classic underwriting business. However, new business was only underwritten to a very
limited extent (premium income: EUR 1 million).
With the latest decision to continue the modestly transacted active underwriting business through a
subsidiary, DARAG will concentrate exclusively on its core business, the transfer and management of
run-off.
“Continuation of classic underwriting business ‘on a low flame’ would make neither economic nor
organisational sense. However, expansion of activities under the DARAG umbrella would lead to a
conflict of interest with DARAG’s core business, the assumption of run-off. We have therefore decided
to consolidate classic underwriting business in a separate company and in doing so create an
independent market presence,” says Arndt Gossmann, since August DARAG’s CEO. “The acquisition
of HVAG in July 2010 provides the ideal platform for this.” Gossmann adds. Mr Wilfried Krauth, who
until 2009 was management spokesman for WÜBA, has been appointed CEO of the new subsidiary.
By establishing the subsidiary and subdividing the business segments (run-off and active underwriting
business) into two companies, both firms will be able to optimally serve the market and efficiently
utilise the available resources as well as the strategic potential of both companies.
As part of the restructuring, DARAG will move its head office from Berlin to the Hamburg metropolitan
region, Germany’s third-largest insurance centre. The subsidiary will operate from Berlin.
DARAG Deutsche Versicherungs- und Rückversicherungs-AG, Berlin
DARAG Deutsche Versicherungs- und Rückversicherungs-AG is the first and so far only German
insurance company specialised in taking over inactive or discontinued business, so-called “Run-off”, of
direct insurers and reinsurers to its own balance sheet. The goal is to offer insurers reliable and rapid
relief from associated risks and at the same time guarantee insurance holders professional and nonbureaucratic
settlement of claims.
With a view to Solvency II, independent experts estimate the market potential of run-off business at
over EUR 100 billion.
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Company contact
DARAG Deutsche Versicherungs- und Rückversicherungs-AG
Gustav-Adolf-Straße 130, 13086 Berlin
Arndt Gossmann, CEO
Telephone: +49 30 47708-143
Fax: +49 30 47708-100
E-mail: a.gossmann@darag.de
www.darag.de
Press contact
ELBWORT Agentur für Kommunikation
Telephone: +49 30 47708-170, Fax: +49 322 21640760
E-mail: presse@elbwort.de
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