Liberty Mutual Insurance said it completed the all-cash deal of about $1 billion for super-regional insurer State Auto Group.
The transaction was originally announced in July 2021. Now that it gained all required regulatory approvals, Liberty Mutual said it adds $2.3 billion in premiums and becomes the second-largest carrier in the independent agent channel with State Auto’s network of about 3,400 independent agencies across 33 states distributing personal and small commercial insurance.
Liberty Mutual said more than 2,000 State Auto employees will join its Global Retail Markets U.S. business unit. The companies will continue to operate as separate businesses throughout most of 2022.
“Together, we’ll be a leader in both the personal lines and small commercial insurance markets, helping policyholders when they need it most and giving our people more opportunities to grow and thrive,” said Hamid Mirza, Liberty Mutual president and COO, Global Retail Markets U.S.
Kim Garland was appointed president of State Auto, Liberty Mutual said. Garland was senior vice president of personal and commercial lines at State Auto and managing director of State Auto Labs, a part of the insurer that connected startups with capital, technologists and insurance industry experts.
Of the merger, Garland said, “Our combined strength allows us to significantly expand our relationships with independent agents and brokers and make more strategic investments in the independent agent channel to continue driving profitable growth.”
Mike LaRocco’s contract as State Auto president and CEO was extended in July 2020 and runs through 2022. LaRocco has been credited with turning around the carrier.
Under the terms of the agreement, State Auto mutual members became members of Liberty Mutual. Also, Liberty Mutual will acquire all the publicly held shares of common stock of State Auto Financial for $52 per share in a cash deal of about $1 billion.
Liberty Mutual acquired specialty insurer Ironshore in 2017 and Safeco in 2008.