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New Alliance Between Zurich and SACE Agreed

Posted on Dec 03, 2010 by Sergio Ulloa ()

Zurich Financial Services (Zurich) through its International Surety, Credit and Political Risk group has entered into a partnership with Italian financial services group SACE. The deal has been struck through Zurich's North American operation and will work in concert with the Italian insurance and financial group SACE, which is controlled by the country's Ministry of Economy and Finance. The partnership between Zurich - arranged through its North American operation - and SACE will establish a framework for public/private collaboration in order to augment the accessibility of surety for Italian contractors involved in major global projects. The deal between Zurich and SACE will cover the provision of reinsurance, co-insurance and surety facilities and will create new surety solutions for Italian companies engaged in work outside of Italy. Michael Bond, head of International Surety, Credit & Political Risk at Zurich North America Commercial commenting on the agreement said: "Zurich's broad international surety experience and global capabilities, combined with SACE's product range and strong position in the Italian marketplace, strengthens the ability of both parties to serve the needs of companies operating in markets across the globe." The newly formed partnership will mean Zurich will use its ability to leverage SACE's strong surety bond capabilities which in turn will offer the Italian group better ability to support its customers in worldwide markets where Zurich is established. Surety bonds are a financial mechanism providing a guarantee to a party to pay a loss encountered from a breach of contractual or legal obligations. A fundamental purpose of a surety bond is a contract of guarantee involving three parties: the contractor, the person providing the bond and the employer contracting with the contractor who requires the surety bond to be provided. The guarantor is normally the insurer providing the bond. If a contractor defaults, the guarantor will provide compensation to the employer for any losses incurred from the specified event. The SACE group is currently operating in more than 181 countries and has obtained an Aa2 rating from credit rating agency Moody's. The Italian financial institution provides credit insurance, overseas investment, surety bonds and financial guarantees across the world. Speaking for SACE Raoul Ascari, chief operating officer said: "This relationship with Zurich increases our reach and effectiveness, enhancing SACE's role as a business facilitator worldwide. By working together, Zurich and SACE will be able to provide Italian companies with surety peculiar capabilities that alone, would be difficult to do." Zurich has been active in recent months in re-evaluating its global operations. In November 2010, Zurich - through its flagship unit Zurich Global Life - said it was re-entering the US life market after a prolonged hiatus. Zurich has taking a majority stake in PT Mayapada Life of Indonesia and acquired Lebanon-based Compagnie Libanaise D'Assurance in order to increase the Swiss insurer's presence in developing markets. As part of Zurich's re-evaluation of group operations undertaken in 2010, in addition to acquisitions such as the Indonesian and Lebanese ventures, it has taken the decision to sell-off assets such as its Spanish joint venture Unnim. It also decided to maintain a 20 percent stake in its Chinese venture New China Life Insurance as part of a strategy to strengthen the Swiss insurer's position on the global stage. Insurance Company Mentioned: Zurich Zurich Financial Services GroupHeadquartered in Zurich, Switzerland, Zurich Financial Services Group is an insurance-based financial services provider with a network of subsidiaries andoffices in North America and Europe and also in Asia-Pacific, Latin America and other markets. Zurich is one of the world's largest insurance groups, and one of the few to operate on a truly global basis. With 60,000 employees serving customers in more than 170 countries, our business is concentrated in three business segments: General Insurance, Global Life, and Farmers.
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