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Reinsurance Group’s Unit to Improve Services With Buyout

Zacks

Reinsurance Group of America, Incorporated’s RGA innovation accelerator and a wholly owned subsidiary, RGAx, has recently inked a deal to purchase LOGiQ3 Inc. The buyout will bring together the business platforms of the acquired company and that of RGAx, which in turn is anticipated to serve the clients more efficiently across the industry value chain by making the insurance procedure much simpler.

Details of the Transaction

LOGiQ3 Inc. is a group of companies catering to the North American life insurance and reinsurance industry with technology, consulting as well as outsourcing solutions. Additionally, the LOGiQ3 Inc. delivers long-term strategic solutions and short-term tactical support across underwriting, reinsurance administration and claims. The acquisition is expected to get closed by the first quarter of 2018. Post completion of the buyout, LOGiQ3 Group will maintain a separate operation and retain employees in their current roles. The financial details of the transaction have been kept under wraps.

Benefits of the Acquisition

The buyout will help RGAx streamline the insurance process as well as expand and add substantial value to its existing and future clients. LOGiQ3 Inc.’s vision, culture and customer focus are similar to that of RGAx, which is likely to bring about new innovative techniques and perspectives, thereby solving some of the current challenges faced by the industry.

With this buyout, Reinsurance Group is set to boost its inorganic portfolio and in the process, improve its core products and services, comprising individual life reinsurance and individual living benefits reinsurance to name a few. Moreover, the acquisition will result in product line expansion that might contribute to risk diversification. Hence, this buyout will continue to support the company’s overall growth and benefit its clients.

Zacks Rank and Share Price Movement

Reinsurance Group holds a Zacks Rank #2 (Buy). Shares of Reinsurance Group have rallied 28.5% in a year’s time, outperforming the industry’s increase of 15.4%. We expect product line expansion, premium growth, improving segmental performance along with robust capital position to drive the shares higher in the near term.



Other Stocks to Consider

Investors interested in other top-ranked stocks from the insurance industry can also consider Manulife Financial Corporation MFC, Prudential Financial, Inc. PRU and Cigna Corporation CI, each carrying a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Manulife Financial provides financial advice, insurance and wealth and asset management solutions for individuals, groups and institutions in Asia, Canada and the United States. The company came up with a positive surprise in all the last four quarters with an average beat of 10.7%.

Prudential Financial offers an array of financial products and services including life insurance, annuities, retirement-related services, mutual funds, investment management and real estate services. The company pulled off a positive surprise in three of the trailing four quarters with an average beat of 0.2%.

Cigna provides insurance and related products and services in the United States and internationally. The company delivered a positive surprise in each of the trailing four quarters with an average beat of 14.6%.


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