Cigna to Sell Property and Casualty Business to Ace

Cigna Corp., one of the nation’s largest health insurers, has agreed to sell its property and casualty insurance business to Ace Ltd. of Bermuda for $3.45 billion.

The deal, which has been in the works for several weeks, frees Cigna to concentrate on its health-care and employee benefits businesses. For Ace, the purchase of the Cigna lines mean a fourfold increase in revenue from premiums, and a chance to establish itself as a significant player in the lucrative business of selling insurance to corporations and financial institutions.

“It’s an historic moment for us,” said Brian Duperrault, chairman, president and chief executive officer of Ace. “It’s a once-in-a-lifetime opportunity.”

Ace, which was founded in the mid-1980s by a group of corporations that were unable to purchase insurance from traditional sellers, has recently begun to diversify, Duperrault said. With the addition of Cigna’s businesses, the company will move into areas such as maritime insurance covering cargo on container ships, loan insurance for financial institutions, and workers’ compensation insurance.

For Philadelphia-based Cigna, the sale marks the end of an era that began in 1792, when the Insurance Co. of North America began to issue maritime insurance policies.

With about 70% of its business in health care and the rest in other types of employee benefits such as retirement plans, Cigna plans to market itself as a sort of one-stop insurer for employers, said spokesman Michael Monroe.

Cigna stock rose $1.38 to close at $84.88, and Ace rose 19 cents to $33.13. Both trade on the New York Stock Exchange.