100% shareholding includes stakes of previously touted bidders Hiscox and Rock
JLT is set to extend its reach in the online affinity market after emerging as the surprise new owner of Pavilion Insurance Network.
JLT Corporate Risks, the company's UK broking arm, has acquired a 100% shareholding in the online niche insurance provider for an estimated £6.65m.
This includes the 13.5% stake of Lloyd's insurer Hiscox and the 10.7% interest of Rock Holdings, which had been touted as a potential bidder for Pavilion after increasing its shareholding in the company in recent weeks (News, 22 March).
The deal, which will net Pavilion's chief executive Andrew Selby around £1.3m, is set to strengthen JLT's affinity insurance business via the web, as well as opening further channels for Pavilion's product range.
Dominic Burke, chief executive of JLT Group, said: "The Pavilion Group provides us with the opportunity to add a new arm to our UK retail insurance business.
"Pavilion is a well run business with strong online distribution expertise. The acquisition will provide the JLT Group with access to online distribution and additional expertise in meeting the insurance needs of affinity groups."
Pavilion, which targets small niche markets using its in-house developed software platform, has increased revenues by more than 46% through the website in 2006, transacting more than 82% of its business online.
Selby, who will be in charge of developing the online business, said he expected Pavilion's e-business to expand further in 2007 through investment from JLT, with an additional range of products to be launched.
Pavilion, which made profits of £423,851 in 2006 and reported gross written premiums of £3m, will be run as an independent company within JLT Corporate Risks.
JLT has launched two rent-a-captive facilities – Isosceles PCC, a protected cell company based in Guernsey and Isosceles, a segregated account company, based in Bermuda.
The company will also re-brand its Captive Management Group as JLT Insurance Man-agement.
JLT said it expected that JLT Insurance Management would extend its services into the management of commercial insurance and reinsurance companies.